Is is being sold in a buggy state, or as Microsoft claims, "the most tested peace of software they have ever released."
Yes.
My PC came with ME; its still got a sticker to that effect, but I upgraded to 98, and I've been happy ever since. (Forgiving the hardware issues, such as that powersupply that put out 13v instead of 12v)
As a bonus, all the new exploits simply don't work against it
