Microsoft has at last clarified Windows Blue is an update.
Read more by clicking on the link!
Which is what Microsoft has been saying all along - back when Steven Sinofsky was still there.
While there will doubtless be a *semi-slipstreamed* version for those with older versions of Windows and for OEM/new hardware installs, that is not exactly a new thing for Microsoft.
In other words, this whole brouhaha has been a molehill.