[Mutiny32]

Well, yes and no to the original question. First the no part:

Windows Mobile was just about the best mobile OS out there for a very long time. Their advantage in being on the mobile scene precedes the smartphone. They designed it to compete with the Palm Pilot and did very well because of the natural relationship with desktop Windows. They also got the PC makers behind them to design, build, and market devices based on PPC/Windows Mobile.
Then along came the idea of putting a cellular radio into these devices. So they modified it to be able to handle cellular connections and calls. At the same time, they were tacking WiFi stacks onto the OS as well. This was still back when WiFi was still a novelty and the implentation was still a mess.
Then came high-speed cellular. Another tack-on. Then innovation in CPU, graphics, UI design, competition, rotating desktops, multitouch, and finally, Open Source. Of course, through all of this, the OS was just repeatedly modified to be able to handle all of this. They have proverbially been "polishing a turd" since WinCE2003/5.0. They have done a surprisingly well job of at least keeping their head above the water. It started out as the best thing out there, but similarly to Palm, they didn't innovate or do a major redesign; putting them in a big hole.

The yes:

Yes, it does suck. Now. Because of negligence, they have put Windows Mobile in a big hole. It is extremely inefficient, a jungle of code, outmoded models, a base UI that is bad, drivers that really suck, layers of interfaces stacked on more layers of interfaces, and third-party UIs that stack on top of their own UI. They have updated some of the core components in 6.5x, but the base problem exists; an ancient core platform. I would compare it to GM putting a L05 TBI engine in a 2010 Z06.Then the UI is a LSx squeezed into a Fiero with a Ferrari body kit.

Windows Phone 7 may solve some of these problems with a whole new codebase, but they are still going to have to be more open, both with their APIs and their OS itself to be able to compete with the likes of Android, Maemo, WebOS, and Symbian.