Yes. It appears that 68 W is "average" power dissipation (sp?). However, I think most ATOTs run their CPUs harder than "average", with distributed computing programs, photoshop, etc...
Actually, it's not really the "average" power - it's the design target power. As in "design to this power dissipation level and things will work fine". It's not "average" or "typical" power - that is much lower.
There has been a lot of debate over Intel's power dissipation numbers online - although I don't hear a lot of engineers getting upset over the numbers. The question is: is max power a useful number to design a processor for? Maximum power is the theoretical maximum power that the design can ever hit - is this the target that you want to use as a design target for a cooling system?
Maximum power isn't anything you are ever going to see - in fact when I worked on the Pentium we spent a good deal of time trying to write a program that actually hit something close to our maximum power number and never got very close at all. Maximum power is calculated by assuming that essentially every possible operation that could theoretically occur concurrently, does in fact occur concurrently. But in reality this doesn't happen. In my experience, maximum power is an unreasonably high target that leads to high system design costs and overspecification of system components. Intel has historically quoted "max power" for designs but changed this practice with the Pentium 4 for various reasons - not the least of which is design cost.
What an engineer really wants, in my opinion, is "what is the maximum power that a user will ever encounter". This is, in my opinion, what "max power" really should be. But this is a hard number to calculate because it you never know if a future program will somehow find a way to use more power than your worst-case program now. It's a lot easier to just take the simulation model of the chip, make the worst case bunch of events happen simultaneously in the model by forcing various parameters and then quote this number as the "maximum power". Trying to figure out the realistic highest power output that a user is likely to see involves the risk that you will somehow underestimate this number and then some application will show up that will cause all of the systems to overheat and crash because you underspec'd the worst case power. So there is a risk aspect to this calculation. But I have yet to meet an engineer who is uncomfortable with the idea of "design target" power instead of "peak theoretical maximum power". It just doesn't make sense to waste money overspec'ing a system to enable operation within a power envelope that will never actually be reached in practice. IMO.
But back onto your original point, KKiller: Thermal Design Power, TDP - the 68W number that I, and several others, have quoted for the 2.8GHz Pentium 4 is defined by Intel as: "A power dissipation target based on worst case applications. Thermal solutions should be designed to dissipate the thermal design power." (Thermal design application note, page 2). So the worst case application set is taken into account with this number, and adequate margin exists to ensure that future applications should not exceed this number as well. Photoshop and distributed computing are already considered in the number's calculation.