WinCustomize.com has an article about the concept of micro-shells. Micro-shells are essentially shell extensions on steroids. They are explicitly designed to plug into your existing shell so that users can add their own extensions (like today's skins).
The example used is IShellFolder, in which a micro-shell would allow users to create their own custom views for folders that make use of things like Longhorn's compositer (Avalon) and other technologies so that you could have potentially hundreds of views to choose from that provide radically different metaphors for viewing your files on your hard drive (rather than the measely 7 that we have today).
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News source: WinCustomize.com
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