It would also have meant launching after Christmas. Bad, bad idea.
No, Coded-Dude is right. Microsoft HAD to rush it, and let's be honest, Microsoft already wasted four billion dollars trying to get a foothold, another billion is pocket change to them to jump to first place for two years (all of 2006 and 2007).
They'd better do better on their next console though, because they're already developing a very bad reputation as far as hardware ("XBox is big lol" jokes about the first, and the second always breaks).