It really is just a threat though. These companies use the appearance of a competitor to extract cheaper pricing from their suppliers. If anyone is expecting better than Netbook performance, they're probably out of their mind.
Yes, but how many people really need better than netbook performance? Most knowledge workers only need email, excel and web browser. SaaS is eating desktop. Modern smartphone is capable of 3d games and even VR.
Dropping prices temporarily until a newcomer is strangled is something we've heard of in the past, but this time the competitor has a huge and growing mobile market, so the threat and lower prices are likely to stay around for a long time.
This actually seems to be more aimed at hurting the ipad for business than hurting intel. You can write your business apps in .Net and roll them out to users who are currently using ios and save pain and cost from using tools like Xamarin to try to use your .Net team to write ios apps with c#.
I think you were thinking of microarchitecture, microcode is related but probably not what parent meant.
Information about Intel internal architectures is highly confidential, but there are remotely related technologies that are generic and public, for example
https://en.m.wikipedia.org/wiki/Register_renaming