Daniel Glazman (NVU developer) has written a post on what he thinks of the current state of CSS and what should happen in the future: Calling for a new CSS revolution. An interesting read.
What would the web be like now if Microsoft continued to work on Internet Explorer? I'm sure it would have been a lot better (less hacks for CSS in IE, better looking sites). Instead, Longhorn/Smart Clients is part of their future strategy and could go any way (new hardware and OS would be required, but you would be tied to Windows and would therefor be more expensive). Richer applications, but to the detriment of competition (i.e. Novell/IBM/Sun - who are investing in Linux and thin-clients) and the environment (old PC's going into landfills).