Of course AMD will bounce back. They will most likely copy Intel with a 4 issue wide CPU themselves. Or, AMD could make an "infamous right turn" of their own, repeating Intels Netburst mistake. You never know.
You mention that the desktop market is not the only thing pulling in AMD's revenue. You are very correct, but, Intel is releasing these Core MPU's platform wide. Mobile (Merom), Desktop (Conroe) and Server platforms (WoodCrest and ULV Woodcrest I guess for blade applications).
Anyone who says AMD is going under is just being foolish. However, if Core turns out to be what it seems to be, it is going to hurt AMD's pockets tremendously. If they can't compete in speed, thermals and price, and as of today, is does not look good for them, AMD will have to heavily, and I mean need to HEAVILY cut prices on the order of about 50 to 70%.
We will see in about 4 months. I am anxious to know the facts.