Wasn't the NT core the starting point for the XBox team? And the original XBox had fewer resources than today's mobile gadgets.
The only reason Windows hasn't been scaled into more segments well, is that Microsoft's bureaucracy doesn't allow it to be stripped to its core as with the Xbox. They insist on layering on the cruft as with Windows CE.
I ran NT3.5 on a 16MB Pentium machine at one point and it ran comfortably, true.
I also ran System/390 on 32MB of RAM a couple of years before that. That's no indication that System/390 is appropriate in any way or manner for the embedded world.
Windows 7 is not easily portable to a phone; That's why Windows Phone 7, a CE derivative, -- an entirely different codebase that MS has been maintaining for the last 15 years, exists.
The only reason Windows hasn't been scaled into more segments well, is that Microsoft's bureaucracy doesn't allow it to be stripped to its core as with the Xbox. They insist on layering on the cruft as with Windows CE.