IMHO the two things holding Linux back from the masses is
a) application support and
Application support is a basic requirement, and the cold fact is that MS Office, Adobe Photoshop and Premier, AutoCAD and all the best games, all run on Windows, Mac OS X or both. Remember, an OS is simply a platform for applications, nothing more.
These days, for the casual user this will matter less, due to the fact that the casual user now spends their time on Gmail and Facebook, but it doesn't matter less enough.
Software such as MSN Messenger and Skype still work best on Windows and Mac OS X . This is FACT. Integration and synchronisation via Bluetooth with the Androids, Blackberrys and iPhones of this world still works best on Windows and Mac OS X. This is FACT.
Even in the enterprise world, where Linux has a far greater foothold, its desktop presence is weak. I recently needed to do a desktop conference call using GoToMeeting. Does it support Linux? Nope.
People expect these things to Just Work, and rightly so.
Allied to this is the issue of pre-installation. Windows and Mac OS X have been around for a loooong time, and are well known. You can't avoid them, even if you have no interest in computing.
You can't avoid Linux either, but your exposure to it is surreptitious, rather than overt. Linux is in cars, TVs, set-top boxes, cash machines, web servers, routers, payroll systems, banks, stock exchanges. All of the invisible places.
Pre-installation on desktop machines would make Linux far more visible, and the hardware vendors wouldn't have to pay a penny for it, but they won't do it unless they think it's worth it. Is it worth it? To answer that question, ask this:
What's the killer desktop feature that Linux has that Windows and Mac OS X do not?