I did not watch the episode, precisely because I was afraid it would turn into a Microsoft ad. Sorry to hear that's exactly what happened.

As far as product placement goes, it's something we're just going to have to live with. The companies that make these movies/shows are in it to make a profit. If they can figure out a way to make more money off of the same show, they're going to do it. It only becomes a problem when people stop watching because the ads are too crass and obvious.

I've seen some pretty bad examples of overly-obvious product placement recently. Some episodes of The Sopranos were particularly bad in that respect. The episodes with the Billy Bass were awful, the way they were waving that annoying fish around.

On the other hand, the FedEx product placement in "Castaway" was perfectly natural and worked for the story. Sure, they could have just as easily done it as a fake company, but they made it FedEx and it made the movie seem more real.