A matter of perspective (but, admittedly, I'm not really the target market). Personally, a remote that also lets me ssh into my server, play solitaire and read ebooks is way more appealing than a remote that's just a remote.

Would it totally kill your market to also provide a software-only option that doesn't completely take over the device?

No, not frowned upon, but they've typically been rather unproductive in the past. The demographic here is largely regular users, who have no skills, or the hobby-hacker, who either don't have the skills you're after or are already 'employed' elsewhere (students, programmers, etc). The people-with-skills-that-are-unemployed crowd don't tend to make as much of an appearance.

There's no harm in trying, though.