jragosta ... You missed the part where I said blurry gets blurrier. I am also using W7 and not OS X. So far, I cannot use any monitor that is not in the native resolution. I have an iMac 20 inch gathering dust, since I cannot see it. Nope, cannot drop the resolution either. Some people can see through the slight out of focus left behind at a different resolution. I can't. I might be able to use a mini and a 27 inch/1080 monitor. If not, my next choice is a 26 inch HDTV at 720/768 resolution. Trust me, I've been messing around with this ever since the demise of the CRT, where you could alter the resolution with no loss in clarity.
OK, so your point is that you ruled out the 27" iMac without even trying it. With its incredible native resolution, it's going to be far sharper than you think. Or even if it's run at double resolution, there wont' be any interpolation - and the pixels will still be larger than what you have now.
If you run it at double resolution, you have a 1280x720 monitor - and it's not going to be blurry. It's nothing like the resolution interpolation that you're thinking about. Go try one out before complaining that it won't work.
My point ... Apple could use desktop CPUs if the mini wasn't so small. The Pro is the only other true desktop from Apple. OK fine, everyone seems to want notebooks anyway, so to hell with desktops and choice. The iMac is a fixed resolution display to me, and as a result, useless. Same goes for everything but the iPad.
Then get an iMac and add whatever monitor you want. It's still cheaper than buying a Pro. And what's wrong with the Mini? It's a perfectly useful desktop computer - and you can add your own monitor. What are you doing that the Mini is unsuitable for?