[Windows Phone 7 General] N8ter:
It's Windows CE with a different UI layer and some system-level restrictions for things like only allowing sandboxed Silverlight applications to be installed and run by the user.

It's a Windows CE system. It's not a rewrite. The User Facing components have just been altered, and many of the system level-changes (hardware support, etc.) can be backported to Windows Mobile without much trouble. It's not like they have a completely different driver model, etc.

It's Windows CE, just like Windows Mobile, except the User Interface is different, it uses Silverlight-based applications and the hardware support and base system has been optimized, improved, and updated.

^- Yes, redundant, but some of you people don't seem to get it so I feel the need to repeat things in different ways to heighten the chances of comprehension.

Thanks for quoting OSNews and calling it an official answer (then not citing the sources)... In the same article you quoted, it's pretty damn obvious:

Microsoft is planning to move to an NT-based mobile OS in the future, and that transition would be closer to a rewrite than Windows Mobile to Windows Phone 7 - which isn't even close - due to the sheer number of differences between NT and CE as of now. The only thing they rewrote was the UI layer. Everything else could be backported to Windows Mobile but the Windows Mobile ecosystem had a bunch of issues, so the only viable way to go about things was to attempt to decouple them.

Saying WP7 is a rewrite coming from Windows Mobile is about as dumb as insinuating Windows Vista was a rewrite coming from XP.

IIRC, there was a time when Microsoft said Silverlight was coming to Windows Mobile, so even that was obviously possible to port over. Instead of updating "Windows Mobile," however, they forked it and positioned the next version as a totally different system and decoupled them to get rid of market stigmas and give themselves the ability to do things like setting higher (more stringent) Chasis/Hardware requirements, among other things.

It was never really possible to make a "touch friendly Windows Mobile" without forking it off and letting WinMo die because the hardware requirements were such that you'd have devices with Blackberry form factors with on-screen controls that took up half the screen, nevermind the Windows Mobile specs are such that half the devices that ran it were inadequate for running WinCE with a WP7 UX layer on top of it.

Positioning WP7 as a new OS has more to do with marketing, market stigma, and leaving behind bad baggage - in addition to regaining a lot of control that Microsoft previously surrendered to the carriers and manufacturers.

It is not a rewrite. I dunno where this idea came from, and I dunno why people feel the itch to defend such a blatantly false statement. I guess looking different = completely new/rewrite to some people. Have fun with that.

The reason why the WP7 OS is missing a ton of APIs isn't cause they're missing. They're obviously there as Microsoft has stock applications that user this APIs. It's that there are no .NET libraries in the OS at the moment that properly abstract the Native APIs that actually exist in the system. Microsoft uses them, some OEMs use them. But, 3rd party developers can't because they don't have the tools to access the system at that level - yet.