I am not rooting for failure, just observing what Microsoft is doing. My observations indicate they are taking the wrong approach.
Trying to shoehorn the tablet to the desktop UI is the wrong direction, And the hardware has several issues that seem to be design failures as well.
Such as the low resolution, the limited storage space offering especially when the OS takes up a big chunk of space. The marketing aspect as well, why are they marketing the keyboard so much? And why no review samples.
Lots of things indicate failure.
I think you don't know enough about the Windows 8 ecosystem to be able to tell what is a failure and success by Microsofts measurements. Are you sure Surface sales are even important, because I don't think they are. Microsoft wanted a "iPad" class build quality tablet available at launch. They wanted to show how it could be done push the OEM's to do something other then load Windows 8 on their mostly poor build quality Android platforms.
Also I don't think the OS takes as much space as you think, because again, I don't think you know enough about Windows 8, Windows RT, and Windows 8 on phones. It's not a desktop OS, it will take up as much space as it does on the Lumia, and I haven't heard one worry about storage concerns on the 920.
I get the Resolution concerns. But its interface is mostly 2 colors you don't need top notch resolutions for that. As for Media, again we will see how restrictive the resolution is on such a small screen, but its not a TV and I don't really get this big push for higher resolutions on smaller screen objects. But it will push a lot of people back before they even look at a sample.
As for the keyboard. Well everyone has done most of the stuff to death. It's the one defining feature that hard to compete with.
This isn't an iPad killer and original manufacturing info tells us that Microsoft has no dream of super high sales. It's a kick in the nuts to the OEM's to get off their asses, and if it does sell enough, maybe just maybe, Microsoft will continue the line.