oh, come on. you mean that?
Wow, I hope you were trolling. Let's deconstruct.
Decent multi-touch: on its way. There are several devices with Mtouch already and it'll only be a matter of short time before it trickles down to lappies cheaper than the iPad.
Usable touch screen interface: needfulness is debatable, but XP can already sort-of work with it, and Win7 certainly can.
Decent media graphics card that can decode HD video: well, as it's only going to output to XGA, I put forward the intel 945 card that's in my 4-year-old laptop, which manages 720p-to-XGA admirably. Hopefully most current netbooks have something more advanced.
10-hour battery life: HP'll do you one of those.
Thin and light: Well, as much as it needs to be. And certainly, as light, if not as crazy-thin.
SSD: again, moot point of needfulness, but there's stuff like the EeePC.
If I'm going to be spending serious cash on a pad-like device, I think I'd probably have the touchsmart, because then I'll have a proper, fully flexible laptop AS WELL, in the one device, and know it's going to be good for about five years, rather than being obsolete, out of warranty, dreadfully uncool and possibly unsupported by the manufacturer and peripherals (etc) within two. But I'll bet you can get something of equivalent performance and featureset for less.
Windows apps OF THE SAME TYPE as iPhone/iPad ones are about the same size - there's no special magic that means Apple i-platform programs are automatically a whole lot smaller. They're just rather simplistic. When you add them all together you probably get as big a combined data load as one Windows one that does all those functions at once (let's call it for the sake of argument "Firefox"). I wonder how much of the internal SSD is actually taken up by the (pared-down) OS etc?
Windows needs more because it does more. But XP runs just nicely - with Office and a few other major apps plus a host of freeware ones covering the iP* gamut, and a good few user files - inside of 32gb. Been there, done that, repeatedly. The OS, if you don't install absolutely every needless option, is only about a gig, and that's for what these days is a very refined, powerful and comprehensive system. Swapfile, can get away with about 1-2gb, if you don't have enough RAM to just leave it at 512mb for the few programs that DEMAND it's there even if they don't touch it. Office comes in under half a gigabyte, and that's for a do-anything, full productivity suite. We're not talking your happy crappy bash-a-word thing here; windows apps tend to be larger because they do a lot more. Comparing "Win7 on a 16Gb SSD" is just not a fair comparison - and I'll bet we'll find they offer 2x and 4x size options because people will start running out of room very fast on the base models.
And if we're just talking getting any laptop of any type, without touch, £429 will get you quite a nice one - not "a low end Dell with 1 hour of battery and poor LCD" (it'll have a better LCD than the iPad for a start, and no-one makes a 1 hour laptop) or "an underpowered netbook with little RAM or HDD space" - a £400+ EeePC will have a gig or more of memory and over 100Gb of storage. In fact, this is the sort of range I'm looking in to suggest what my mother buys as a much superior and long-lived replacement to her cramped but otherwise perfectly good EeePC when she retires. I don't know what shops you're buying from, but I suggest you go elsewhere as they're ripping you off badly. £200-250, now that'll buy you some crap, but I don't see the Pad being offered at that price.
And hell, I'm SURE I've seen some kind of finger-touch HP convert-a-tab in PC World for under £500.
Final words.... 1. We're not comparing Tata Nanos to Mercs here. For a start, the iPad is hardly a Tata. The £150 Linutops being sold in my local supermarket better fill that bill. And any kind of PC that could be described as Mercedes-like, e.g. an Alienware gaming rig, would be a very unfair comparison. Instead we're more comparing a top-of-the-range Fiesta, bought on HP, that's missing its back seats and with a welded-shut tailgate being driven on a restricted learner's permit, to a paid-for, unmolested midrange Vectra that only costs slightly more, in a land where much is made of the small car being easier to park, but 99.5% of the parking slots are actually quite large anyway. And there's a fingerprint reader on the Fiesta's passenger door that won't let anyone in that Ford haven't pre-vetted.
2. I don't WANT to be an Apple hater, really. I like the ideas behind their stuff, of making it aesthetically pleasing and easy to use without sacrificing performance, and I'm taken by the possibilities that better use of instant-on, multitouch devices like the Pad open up. But they ARE massively overpriced (make it £200, and we'll talk), and the reality never matches up to the massive hype, particularly once you start finding they're just as full of embarrassing flaws as anything else - but the makers aren't as apt to own up to design or manufacturing oversights, or to fix them, as their rivals.