What you say is basically true, but let me try to condense it a little:
Windows is the default workhorse for people who use full-size keyboards and mice, who sit at desks all day and/or all night. It's a majority market at present.The small / portable devices are not a useful platform for Win7 -- but who cares? Windows shouldn't be trying to squeeze itself onto such platforms. It's silly. It's a perfectly fine desktop OS, and a satisfactory laptop OS. It is not all things to all devices, however, and Microsoft looks stupid if they pretend that it should be everywhere. (And yes I know about WinCE and so forth...)
If Microsoft squeezes Windows into a tablet and makes it useful, it will no longer be Windows as we know it, even if it retains the name.
But Windows 7 was designed from the ground up for touch screen tablet computers.
Read this:
MultiTouch Capabilities in Windows 7
http://msdn.microsoft.com/en-us/magazine/ee336016.aspx
Remember, this was long before the iPad even came on the scene.