Do note that the Pandaboard has two HDMI/DVIs, onboard wireless, and onboard DC/DC. And I don't think the lowest end Atoms can handle 1080p video.
I don't see the problem, as long as the graphics chipset can do the heavy lifting. If you don't get an ancient Intel chipset (which is sometimes bundled with the Atom), 1080p should be no problem. You're right that HDMI pushes the price to a little over $100, and you need an external power supply. I doubt that you'll find dual DVI/HDMI on an Atom board, since they tend to be targeted at the low end.
The Pandaboard appears to lack any kind of high-speed connectivity. Slow 10/100 ethernet (most Atom boards do gigabit), no PCI-express, SATA or old-fashioned PCI. Only expensive/slow SD cards for storage, and even slower USB 2.0. Not a competitor for a PC-style Atom board at all in my opinion. Software support will also be worse: how much time and energy is spend on testing Ubuntu on ARM vs. x86(_64)? No Wine, can't run Windows virtualized, no proprietary drivers. I do get the cool factor of an open design, and an alternative architecture (I once played with Alpha and Sparc, too), but I believe you're in for a disappointment if you expect them to compete with the low-margin, large-scale manufacturing of companies like Intel and Asus, although I would love for them to succeed.
If you're just looking for a very cheap low power computing solution, a used laptop might be your best bet.
Sure, it's hard to compete with used hardware on price/performance, but that's a different issue. I believe we were comparing brand new products currently for sale.