I always installed Watercolor on a new computer. It's still beautiful and definitely the look they should have chosen and played to their strengths.

I think they were so caught off guard by how incredible Mac OS X _looked_, that they didn't realize it wasn't just veneer, but a genuine evolution and improvement of how Mac OS _worked_. This became Apple's competitive advantage for over a decade as Microsoft chased different styles while consistently botching how it would impact usability.