I think that was for a GPGPU using an x86 instruction set emulator, which in turn stemmed from people connecting the dots when nvidia
started hiring ex-Transmeta employees
This "Project Denver" ARM announcement is a complete change in direction. Rather than use an emulator (with its huge built in latency) and relying on x86 code entirely, nvidia (like TI, Qualcomm etc.) will now have big-time RISC compatible OS.
BTW : You did know that Microsoft itself has an ARM licence ? Implication being that Nvidia's Project Denver
may be a joint project with Microsoft and/or Intel*.
Desktop applications may take a while depending upon how may cores the design scales to and how efficiently the parallelized pipelines can be integrated, but I think this news means that nvidia just announced that they aren't happy with only 90% of the HTC and ~88% of the workstation market (they could approach 100% marketshare in both if this comes to fruition), and would quite like to be a player in the ULV tablet/netbook/notebook market.
*Something I wouldn't write off since
Intel and Nvidia seem to have come to an accord in an out of court settlement regarding Nvidia's suit. A certain satirical blogger posted that Intel are due to cut a cheque for $US1 billion to add to Nvidia's coffers. It wouldn't surprise me if a joint ARM (see what I did there!) initiative to counter AMD's Bobcat et al. is in the works. Intel have nothing presently in that space, and until
Larrabee/Knight's Ferry becomes ready for primetime, has no market overlap with Nvidia.