The new Dashboard makes a great first impression. However, there are other improvements to Xbox Live that are much appreciated. Perhaps the most noteworthy is the "Follower" system. Much like Twitter, you can "Follow" other Xbox Live users--up to 1000. This way, you'll be able to easily see what Major Nelson or any of your favorite Shacknews writers are doing on Xbox Live--even if they don't follow you back.
The decision to have so much system memory reserved for the OS may not be conducive to game development, but the end result is an operating system that encourages multitasking. It's a lot like using PS Vita--and that's a good thing. Being able to pin an additional app like Video Studio is quite cool. Even more remarkable is, at least with the simple tech demo Microsoft had set up for us, how stable the console is even when running multiple apps; with Video Studio pinned and recording a video, the framerate remained steady.
Another smart decision: requiring all games to be installed on the hard drive. You can switch from one game to another game incredibly quickly. For example, saying "Xbox, launch Call of Duty" will activate a three second countdown. Once that's done, the game will seamlessly open.
The Marketplace is now consolidated into one place
There are some kinks in the system, but given the early nature of the software demoed, these are things that can be remedied before the console's November launch. Facial recognition shows promise, but it seemed sluggish. However, being able to simply sit in front of your console and have the system automatically sign you in certainly
You can pin any number of apps to your Dashboard, but you can't change the size of the pins (yet)