There are a few issues with this:
1. Which slot on the motherboard would it go into?
2. It would cost them a lot more to produce.
3. If the chip is only as fast as say a standard hard drive then it would not be suitable for those that need faster (who currently use RAID).
4. Would possible need to produce a different version for laptops as they don't generally have the same slots available.
5. Would have to be a writable chip (i.e. flash) so it can be patched and configured to ones needs. This however would make it easier to duplicate (pirate) the chips.
6. The chips would have to come with a warranty, and I and others wouldn't accept a warranty that expires before the next version is release, at least.
7. It wouldn't really integrate itself better with the hardware, and you'd probably just be more limited in your choice of motherboard.
8. The page file would probably not go on the chip, for performance and cost reasons, so you'd still need a HHD even if you have no other programs to install.
9. If the registry is on the chip then, since that has to be writable, what do you do if it gets corrupt or a virus.
It might be viable to put parts of it on a chip, or even having it so the license key is embedded onto some sort of chip but at this moment in time I don't think that idea would really work, but who know what the future will bring.