After the less than stellar success of WinCE (as compared to the Palm's popularity), Microsoft is revamping their handheld OS with the upcoming Pocket PC OS (codename: Rapier).
For some reason, users did not seem to like the idea of placing a Desktop-OS onto handheld screen.[heavy sarcasm]
When WinCE came out, Newton and Palm users were in agreement about WinCE... that it was taking a step backward. Newton OS was a particularly elegant implementation/design of a true Handheld OS. Everything was designed with the handheld user in mind. The traditional "desktop" interface was thrown out, as it didn't apply anymore.
This preview of Microsoft's new Pocket PC OS describes some of the new "innovations" - such as a menu-bar on the bottom (so your hand doesn't cover the screen), single tap (vs double), and tap and hold. These and much more, found in Newton OS, 7 years ago.