I think that a 1 GHz chip certainly has enough oomph to do plenty of useful work. Especially if it was running, say, Windows 3.1 instead of Windows 7. (Or even Windows 98, for that matter, it's so powerful.) Of course, that product is no longer available from Microsoft, but one can run a stripped-down version of Linux... or even a free clone of MS-DOS.
Ah. If it can't run Windows 7, then I suppose there's no real reason to use an x86 chip instead of, say, an ARM chip, or a PowerPC chip, or a bunch of other possibilities? That could be, but it seems like this particular performance and wattage spot isn't occupied by other architectures.