So let me get this straight: Apple spends several years carefully building an ecosystem for it's hardware and software, and it is nice enought to give away aan excellent free program specifically to gain market share and to leverage hardware sales. It is a closed ecosystem, which is what you pay for being able to use a nice free state-of-the-art music management program.
Enter Pre, a direct competitor of Apple in one of the most strategic lines of Apple's business. How do you think Apple should react when Pre starts (ab)using iTunes, thus gaining more ground and cannibalizing iPhone/iPod in process? I'm surprised they were nice enough to let it stay for a while instead of forcing a mandatory update down everyone's throat and making an incompatible change to the iTunes Store protocol (which would be justified given the shamelessness of Pre strategy).
Maybe Palm should consider making it's own compelling software instead of weaseling it's way through and piggybacking the success of Apple. Or, as a more open (yet inferior) alternative, use Microsoft Media Player as it's music software

Taking a casual look at screenshots immediately reveals icons "borrowed" from KDE. Hmm... I don't think those were in public domain. Gods of GPL won't be pleased with it, for sure. With this attitude, I wonder if the entire OS is truly written from scratch and not a single file from any other project covered by GPL was "incorporated." Because if it was, that would be a shame. And it would create significant issues for the SkyOS developers if they try to sell the product.

As for the viability of the project (assuming that it's legally clean) - no, it is not viable. As simple as that. ISVs will not develop software for it and people are confused enough with Windows vs OS X vs Linux - the market is saturated. I'm sure SkyOS will have it's share of dedicated followers and users (all 23 of them) but that's pretty much it's niche.