This is fine if you're only running on a single core, however if you're a multiprocessor OS you still need to deal with legacy when bringing up the other cores. Intel and AMD should consider a mode that disables that and brings up the other cores using a 64bit SIPI. While I applaud Intel on the X86S idea... I think there is room for bits of that without throwing out all the backwards compat. An X86SC which drops real mode and only supports 16bit 'real mode' in virtualization.

Yes, I see the argument that if you go to that point you might as well just use emulation. However running mixed 32bit/16bit code (Windows 98/95) becomes problematic just because of performance reasons. DosBox does well, but good luck supporting games for the Pentium 3 era that still used 16bit libraries because of course they did. (16bit Installshield was so common going into 64bit that MS just has code to replace it so 32bit applications can still be installed despite having a 16bit installer)