One of the cheapest netbooks on the market is the 3K Razorbook/Longitude 400. By default Little Linux Laptop OS is pre-installed. Untill now there wasn't an alternative Operating System, because these netbooks don't use an Intel x86 compatible processor, but an Xburst processor. Now there's an alternative OS called 3MX.
3MX is a very powerful & complete distribution for the Razorbook (or re-badged) netbooks. 3MX replaces the normal Little Linux Laptop OS & is a very user-friendly Operating System that comes with a lot of pre-installed software such as: Firefox 3 web browser, VLC Media Player, Transmission, Medit (HTML editor), Dillo web browser, Wifi Stumbler (for finding of wireless hotspots), Pidgin chat & Xchat.
3MX also features several games such as Barrage,Tux Puck & a Nintendo Gameboy emulator.
Please notice the install of 3MX will cause you to lose all data & personal settings so please back up all of your files.
Head over here for the installation instructions & download links.