The real reason MS$ won't allow the codecs we want is because every moron on earth is always trying to find a reason to sue MS$ because they are so huge (the potential payout is always astronomical). Plus, they have deals with movie/tv now, so I am sure they don't want to support formats that are used for piracy against those same studios (even if the codecs have plenty of other purposes--i use hacked mpg codecs, xvid, divx, etc in all my own home movies).
I don't agree with it. But I can see why they stay away from it.
Anyone that argues that WMV is better than XVID, or WMA is better than MP3, you are a moron, and you should really start learning more about codecs and a/v in general. Sure, you can say that this encoding tool is better than that one, but when it comes down to the formats themselves, no question that MS$ formats are pretty crappy in comparison...