According to Bill Gates, Windows 7 will be out much sooner than expected. A week or so ago, Microsoft even hired away Adobe's main GUI guy to design the user interface for Windows 7. That was quite a shock for them to bring in someone from outside - and he's good. I think in the long-run, Vista will be remembered much like Windows ME.

Here's a little about Microsoft bringing in Adobe's Photoshop and Lightroom guy:
Adobe guru to improve Windows interface
This is kind of exciting to me. They needed fresh blood so bad working on Windows 7.