Chris Dawson talks to an Intel spokesperson who confirms Intel's lack of commitment to making Classmates in the long run:
As she pointed out, the Classmate was never intended to be an Intel-branded device. It is, instead a design specification for a laptop to be used in educational settings, particularly in developing countries. She also noted that, while the spec uses Intel processors, local OEMs would be free to use chipsets from other manufacturers and customize the design to suit the needs of a particular locale.
So right now Intel is producing these things at a loss, and at any time they can walk away and say "Hey, it is just a reference implementation, someone else has to make them for real." Of course, doing that at a profit may be a challenge.
X-Box hacker and Chumby creator Bunnie Huang has a review of the internal electronics and industrial design of the XO. He's impressed.
Brian Jepson has a pretty thorough explanation of how to update your XO, particularly if you'd like to keep a stable and development build on the system at the same time. Basically, the XO is designed to retain two working OS's, generally the current one and the previous one, but if you're careful you can do other tricks. Actually, it is more accurate to say that by default it will keep up to four versions of the OS, because it retains a "pristine" version of each build as originally installed separate from any OS changes you subsequently make. This is, obviously, built in, redundant disaster recovery, running in the background all the time. Handy.
Brian's HOWTO uses some of the XO's boot "cheat codes," which are more fully documented on the OLPC Wiki, and also handy.