Microsoft LiveFX: Apps that look like a browser

Regardless of whether you’re in the Google camp or in the Microsoft camp, I think it’s a fair statement to say that these differences of viewpoint accurately reflect each company’s core strength and focus: Google wants the browser to grow to subsume the desktop; Microsoft wants the desktop to grow to subsume the cloud.
This was the concluding paragraph in a post by Danny Thorpe of Microsoft (and formerly Google).

His post is itself a rebuttal on Dare’s article: Live Framework (LiveFX), Is it Microsoft’s GData or Something More?:

A number of LiveFX’s additional features such as synchronization and resource introspection which have no analog in GData are fairly interesting and I wouldn’t be surprised to see these ideas get further traction in the industry. On the flip side, the client-side Live Operating Environment is a technology whose benefits elude me. I admit it is kind of cool but I can’t see its utility.
Danny answers:

The answer, in a word, is “offline.”

The local Live Operating Environment (local LOE) is what makes running mesh-enabled web applications on the desktop, outside the browser, possible. The local LOE creates and manages a sandboxed execution environment for the mesh app, just like a browser would for an HTML+JavaScript or Silverlight application but without the browser UI frame looming overhead.
It seems like a trivial thing, whether or not the browser frame surrounds your app UI. Does it matter? The answer is yes - having your app surrounded by browser UI constantly and forcibly reminds the user that this isn’t a real app, it’s just a web page with lipstick.
The Live Framework local LOE is a client application that works like a browser. It may even create an instance of the browser internally (I don’t know the internal details of the LOE) but it is fundamentally treated as “not the browser.”

I am trying to wrap my mind around this all myself :)