I wouldn't even think of using Windows! I use Linux personally for my day-to-day work, but the whole point is to do away with conventional OSs and software emulators and have an embedded device that doesn't have the complexity or drawbacks of Windows or Linux.
However, custom chips would be emulated, but this level of emulation would be built into the OS and you'd never know itwas there.
As to Paranoid's comparison to the Milan. The Milan was supposed to be a full desktop, where I'm looking at a more specific niche. Second, the Milan used a dead-end processor and was considerably expensive for what you get. And I speak in past tense since I don't consider 040 and 060 based machines to be in any sort of reasonable price/performance category anymore.
Remember power without the price? When did that become "sorry but this is the fastest we can go with these old chips and you'll have to pay top dollar for it"