Saying there were obvious, preventable mistakes is different than saying the entire product is a blunder.
The early release was a mistake. A mistake that cost them billions of dollars and did nothing to help them measurably "win" against Sony. [1]
The nonsense being grafted onto XBox Live and the dashboard in general is also a mistake. [2]
The 360 is an overall success despite those things.
[1] The 360 succeeded largely on the strength of XBox Live and Sony's shooting themselves in the foot over-engineering --and thus overpricing-- the PS3.
[2] Allowing publishers to erode the experience. Muddying up the formerly-clean media experience with largely nonsensical divisions of functionality is a mistake.
There is a counter argument in the book "The Race for a New Game Machine" that makes the case that the early release was a key factor in passing the PS3. If next XBox holds on, it will be money well spent.
I'll certainly take a look at that, but I remain unconvinced thus far.
The PS3 was demonstrably price-bound for its entire first few years on the market. The existence of the 360 or its early lead just didn't seem to matter. And the "needed to launch first" position has a habit of entirely writing off any negative effect of having poisoned gamers against MS Hardware quality. (Which to that point had a spotless reputation.)
The early release was a mistake. A mistake that cost them billions of dollars and did nothing to help them measurably "win" against Sony. [1] The nonsense being grafted onto XBox Live and the dashboard in general is also a mistake. [2]
The 360 is an overall success despite those things.
[1] The 360 succeeded largely on the strength of XBox Live and Sony's shooting themselves in the foot over-engineering --and thus overpricing-- the PS3.
[2] Allowing publishers to erode the experience. Muddying up the formerly-clean media experience with largely nonsensical divisions of functionality is a mistake.