This icon, over here, lets me use google, and watch videos on youtube... This icon, it's to write documents. This thingy over here, it lets you see the Earth (seriously!!).
Me: Can you click on the Start button and..
Customer: Wait, what? Me: Click on the Start button.. at the bottom left of the screen... Customer: Oh! I see it!
Seriously. Every damn day. This is where I stay quiet and *tears her hair out*. The amount of complexity in installing your operating system, setting it up for internet access, setting it up to play multimedia (codecs etc), and it many cases even installing the apps they need like Office.... these things DO NOT MATTER. If I asked one of my customers to install XP themselves... or bring home their new computer without a PDF reader installed, without flash installed (for those cool videos!), etc... They'd all leave! They get their computer back, they know they can open their attachments (video, pdf, etc), they know they can write a document, look at youtube, search google. This makes them happy!
Now, compare to Linux... you do not ask the customer to download it, burn it to an iso, and install it. No. A techie does it. I run my own business, doing nothing but Linux install, support, upgrades. When they get their computer back, or their new computer.. they can open pdf files (default in every linux install). They can view multimedia (I installed the codecs, verify sound works, etc.) They have shortcut icons on their desktop to start "the word program". Another to browse the net. Another for Skype (that I installed), another for playing music. These people.. Are happy! I cannot see how anyone can complain about the pains of installing and configuring linux (as if Windows was a breeze to get set up!). Joe Average User does _NOT_ install his own operating system, and he does not configure it for use. He gets it, and uses it. If you don't see that, you need to work in a small-time PC repair shop for a little while, talk to some real computer users.
The cost of living hasn't affected its popularity.