I’m shocked by the amount of criticism that the XO laptop has received. Interaction designers everywhere are falling over each other in a rush to find the next serious violation of a usability metric that they’re mistakenly porting to laptop design for 3rd world children. Just because a guideline exists for rich people and their e-commerce websites it doesn’t mean it holds true for 4 year old children experiencing technology for the first time in Africa. They also seem to forget that a novel enough project can break every interaction guideline in the book and still succeed. There are some experiences you can not hold a yard stick up to, and say “Usability = 20% therefore product will fail”. Remember, it’s not just usability that defines success. I believe usability only determines success when products have worthwhile competitors.
Guitar Hero and Rock Band are hugely popular with people who can't (and probably could never) play guitar really well. When they’re rocking out in their bedroom, they couldn’t give a shit whether it’s real or not, they’re just really enjoying themselves. The same is true for guitarists who close their eyes and imagine they're on stage. Unfortunately I’ve met the following XKCD character and I’m sure you know a couple yourself.

The sheer frustration is evident on their face, which silently screams… “But you didn’t spend years learning guitar, how dare you experience the same joy as me, with just a few plastic buttons? ” If the experience is good enough, the medium is irrelevant. (Yes, I realise thats the selling point of heroin)
Many of the recent social sites (i.e. web 2.0 style sites) presented some serious usability problems, and ignored many previously unquestionable design guidelines. If they were submitted for usability analysis they could have flunked under a sea of "Unexpected behaviour", or "User not sure what the [+] button does". However the novelty of peer produced content, plus the quality of the delivery ensured they would succeed. No matter what Jakob Nielsen says.. It's important to remember that if you're doing something really new, the old rules might not apply that well.
I believe that the XO laptop will do well, and people who are criticising it seem to be underestimating the design challenges the team faced. In 2002 Nicolas Negroponte set about the challenge of delivering a laptop for $100 to children in the 3rd world. 5 years later people are using them. There are now children in Peru who are, for the first time, seeing and recording video footage, drawing cartoons, playing maths games, reading hundreds of eBooks and much more. Considering that previously these children saw maybe four or five books per year, it’s hard not to call this project a success.
Yes, the interface could be better. So could every interface. This is a first run, it will only get better and better. I have no doubt that the next OS will blow "Sugar" out of the water, and that's also something to celebrate. Besides, the children (aka the end-users) seem to like it in its current form. What are you gonna do, tell them they can’t possibly be having fun due to a level 3 violation of Fitts law in the second screen? (OMGZ, how could they make that mistake!!1!)