In terms of raw performance, the Cell CPU in the PS3 is probably up to the job, but it is not an x86 CPU. Windows is developed to run on the x86 instruction set. There are Linux distros that have been built to run on Cell, and therefore you can turn your PS3 into a custom computer, but Windows is right out.
Whoa, hold on there. First off, when you run linux on the PS3 (which you can NOT do with the slim version and later) it disables the RSX chip, which is responsible for the graphics and HD audio. Second, while it has 8 cores, and is 3.2ghz, it's not comparable to dual quad cores.
Having said that, I've had linux running on my work PS3, and it works nicely. It's not a wicked speed demon, but it's not slow either. I sometimes use it at home so I don't have to connect a pc to the TV, as well as tinkering with linux.
BTW, so far windows is not able to run on a ps3. Doubt it ever will.
Nope. It's not even close to as powerful as a good modern desktop. The GPU is the equivalent of desktop parts 3-4 generations old, and the CPU, while impressive, is completely nonstandard. Part of the reason its specs are so good on the CPU is because it doesn't have to support a full x86 instruction set. The specs may sound good, but a decent modern desktop will be quite a bit faster than a Cell in every way.
You can run Linux on your PS3 if you want, but it's not going to be as fast as you're thinking.
The Cell CPU in the PS3 isn't really an 8 core CPU either. There is one main core, and 8 present only 7 working "helper" cores. These other cores aren't that powerful and need to work together to get work done. Well threaded apps will run fine on it but other apps won't. As correctly mentioned I doubt you'd ever see windows on it as the Cell doesn't exicute x86 code.
The Cell CPU is great at number crunching, like the kind used for simulations. It's also pretty good for games, but it's drawback is that it's damn hard to code for. Specifically for such work though it is theoretically faster than modern x86 quad cores. Of course since it's hard to code for achieving that performance isn't easy. Not only that but modern x86 CPUs are designed to handle more than just games, but must also handle modern OS tasks.
As for the GPU it's pretty similar to a GeForce 7900, but more efficient especially since it runs a variant of Open GL tailored specifically for it. As such the shaders on the PS3 cannot run CUDA apps as they are basically only as capable as the shaders on the 7900 series. Next to a Radeon 5870 though, the capabilities of the RSX seem down right pitiful.
Generally speaking Cell processor is SoC (System On Chip) and it is composed of one main PowerPC-like processor which has attached on his internal bus 8 other DSP like co-processors. They all work as one single processor.
It is more like cross-bread between general purpose processor (for example x86, ARM, PowerPC, etc.) and number crunchers (for example DSPs or GPU).
it only has 256MBs of main memory and 256 MBs of video memory, hardly state of the art.
The memory may be miniscule but it has insane bandwidth and very low latency. Though you could load a limited amount of textures, you could swap it out really quickly. Though there is a limit on what you could do with a limited amount of memory.