I run Ubuntu Fiesty Fawn (old, I know) with XFCE on an ancient Pentium 233. It has 90 mb of physical ram and a six gigabyte hdd. I use it as my test server, and it has never gone down, except during power failures (not gonna waste a ups on that old thing).
Mind you, this is a computer that had trouble running windows 98 reliably... (although, that's probably window's fault.)
Point is, I have no doubt that pandoras will be able to run even the most "complete" distros (compiled for arm, that is), with a "real" window manager. (I don't expect gnome or KDE here to work at daily use speeds, but I think there are fine alternatives that will run speedily)
The pandora is plenty faster than that computer, and has lots more ram, so with a lightweight-ish distro+WM, I think we can expect plenty of acceptable multi-tasking speed and reliability.
Mind you, Linux will run natively, but windows has to be in an emulator, so windows automatically gets 99% off in the speed department.
I'm positive someone will figure out how to get around the memory requirements and waste a week of their life on the startup so that they can post a video of XP on a pandora, but I don't think anyone should expect any sort of windows to be functional (well, maybe 3.1 or 3.0. I got windows 3.0 to work on my pocketpc in an emulator, but it's incredibly buggy).
Summary:
"Full" Linux: YES!!!
Any Windows: No.