I'd think that its quite plain that the Air isn't designed for uses such as plugging in your video camera and editing your movies, or running that Windows VM. It's on par with a Mac Mini: all the basics covered. Word processing, watching movies, listening to music, traveling, browsing the web, nothing like editing a home movie or playing Crysis in your Boot Camp partition. Hell, if you want an Air, you shouldn't really be thinking Windows anyway, the hard drive is small and the processor is slower. I'll tell you who the Air is designed for: College students.
College kids are all about buying Macs and staying trendy. Walk on a campus, you'll see more Macs than PCs on students' laps. A lot of those are Macbook Pros. The wealthy parents buy the best, even though the child is gonna be doing his gaming on his XBox and isn't majoring in anything Film related. So this year, when kids go to get their computer for college, they'll see the slimmest Mac that weighs next to nothing that they can take to class and look cool in, while still being up on Office and some light Photoshop, listening to music, and downloading movies. This is for them. I'm a college kid and I'm going to go Air. It can be a primary computer for college kids, that's where it'll see the most success. Plonk $150 for 500GB of external storage and get the Superdrive for DVD watching/ripping and you're all set. And with an educational discount the Air is $100 cheaper than the lower end Macbook Pro ($1699 and $1799), so for $1950 you can have the machine that you would want to lug around and have the battery survive on for 4.5 hours a day, something my Macbook Pro falls an hour short of.