That is the way Android applications work within that sandbox, it's to make it just about impossible for badly coded or hackers or virus programmers to do any kind of permanent take over of the Android machine.
That is what Windows based machines lack, a safe sandbox for applications. That is why 80% of Windows machines are full of bugs, viruses, memory leaks, keyloggers, spam servers and other crap.
Well, yes; but there is a balance to be found between `the user can do anything at anytime to anything' (the traditional Windows model) and `the user can do nothing but run the software we provide'. Most Linux systems, properly set up, avoid most of the flakiness of Windows while still allowing decent applications to run. But these distributions all assume that the user will have access to administrative rights (i.e., full control) at least some
of the time. You can break a Linux system just as well as a Windows one if you are careless with that assumption.
It is unknown at present (so far as I understand) what level of software installation control Archos will allow over its Android devices. Even if it's total freedom, you're still going to limited by the Java sandbox, which in itself is pretty restrictive.
But I'll be interested to see how it works out.