Yes, that abandon of DirectX 9 is a bit surprising considering that's what there is in XBox360.
As for the DLL enhancements, from other sources I gathered that the main one is just having everything in user mode, instead of kernel mode like in old DirectX, which saves a lot of kernel mode switches and allows small batches to be efficient (like in OpenGL).
Another interesting twist is that DirectX 10 looks like much more of a state machine according to rumours, rather than the more OO design of previous DirectXs. We'll see.

Since MS are also making a mess of OpenGL in Vista by artificially limiting its hardware-acceleration support (cf. OpenGL.org, since it's a purely artificial limitation though, I'm hoping IHVs will find a way around), it looks like MS tried to make sure nothing 3D is going to transition smoothly in the Vista era... At least we can't accuse them of just axing a non-MS API since DirectX also gets the axe. :lol: