Re: iPad?
I think MS are going after everything with the surface. Gamers (with Pro) get a Core i5 and *should* be able to play PC games like Diablo with a keyboard/mouse as well as more casual games, true, it won't be able to compete with high end PC's but if it'll play the latest games with reasonable quality it'll be on to a winner. Business users who use PC's will go for this and also may go for Windows 8 on their desktops as well as Windows Phone, build everything around the Surface and let everything work around the Surface.
People who want a tablet will have a choice, go for a tablet which is limited in what it can do (iPad/Android/Win8RT) or go for a tablet which runs a full OS and can do anything (Pro).
The big question is how they get it out there, the XBox was easy, pay lots of money to get developers over to the XBox with exclusives and timed exclusives, bring out killer games like Halo, with the Pro line the killer apps are for business, Office, Photoshop, not cut down versions either (how much would a professional designer pay for the Pro with Photoshop and Stylus for drawing stuff for instance?).
Business, as I said, will love this machine. You're at work, working on a presentation on your PC made with MS Office, you have to take the presentation to the other side of town, you flip the docs onto the Surface and continue to work on the train/bus, get where you want to be, plug it in via HDMI and display the presentation. Or you can make your presentation, email it across town and know that the person on the other side can open it on their desktop using Windows.
But MS won't sit on it, they will have tight integration with XBox Live and maybe bring out some exclusive "Made For Surface" games designed with the screen size in mind.
I think Surface is going to be a major win for MS, I also think that MS will share the design with other companies letting them use the magnetic keyboard thing even if it's competition with themselves, MS wants to dominate on the OS space without much thought to the hardware side, as long as they are selling things with Windows 8 on it, they won't care who is selling it, and by bringing out what is undoubtedly a fantastic design, they have set the bar way above anything currently on offer.