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Why would anyone subject themselves to using this?
Because it comes with the phone, and up until recently there were no other options.
Windows Mobile is one of the more 'open' platforms when it comes to third party apps. On win mobile you can choose to install Fennec (mobile firefox), skyfire, opera, etc.

Apple on the other hand bans anyone from making a replacement browser

Once someone makes something better than safari for the iPhone, I'd complain. But that's a big ask.
The really unfortunate part of this is that it's going to probably come with Windows Mobile 6.5. I'd never use it, but most people use whatever default browser they're given. After Firefox's success the last few years you'd think MS would want to put out a competitive browser on the mobile front, especially considering Opera's share!