At least Microsoft are doing something for the peopel who don't understand how to use/buy anti-virus products. (I feel I may have sparked a conversation here and Rast will probably give some sort of large comment. )
Assuming that MSE comes pre-installed, then I can safely say that computer illiterate people will be better off with MSE rather than something you have to install as the installation process alone is mind boggling enough.
I think this is a good move, if it comes preinstalled. In thery is means no pc will be without AV protection. Surely thats a good thing that will help slow the spread of viral infections.