A big thanks to bjf2000 for emailing us this info. Paul Thurrott's Longhorn preview has been updated with new information from people in and close to Microsoft!
At the end of the article Paul makes an interesting prediction, "...I think we're going to see a Windows XP refresh, possibly called Windows XP Second Edition (XP2E) or Windows XP Service Pack 2 (XP SP2), before Longhorn ships. This release will provide two key benefits to Microsoft: It will delay Longhorn until at least late 2003 and give the company an opportunity to slip in a few needed new features, like the Corona player, Freestyle and Mira technologies, updated hardware and software support, and the like. If this happens, they'd have to time XP2E for Fall 2002, which wouldn't be hard. And it wouldn't be surprising to see XP2E offered as an OEM-only release, one that would only ship with new PCs..."
Check out whole article here.