This is just a mock up that i did, it took a couple of minutes, but that just goes to show how little effort would have to go into making a Windows 7 Phone that looks like the Zune HD. Windows 7 Phone (worst name ever btw) has launched and has no really good looking hardware. The Zune HD was just gorgeous in every way when it launched, so just imagen if it had a bigger/better screen like that of the iphone 4 or a Super AMOLED and had a rear and front facing camera, 2 capacitive buttons for search and back and thats really all you need.
i sure as hell would buy one as soon as i could. Microsoft would team up with the likes of HTC to make the phone. Google made their own phone (the Nexus 1) and sold it so that developers would have a device to make apps for. Microsoft could do something similar so as not to piss off to many of its partners. With each major release of WP7 Microsoft could team up with a different hardware partner to make a new handset that was actually nice.
Just a thought...
