I recently upgraded my home Win95 box to Win2000 primarily because I was finding patches and upgrades weren't forth coming and I was noticing that an increasing amount of hardware and software requires Win98 or above. AFAIK, the newest MS media players (IE too? IE is practically an OS after all) won't run on Win95 so MS is indirectly coercing people into upgrading.
At least my upgrade was a definite improvement. I'm just worried that when IE 7 or the next version of Office comes out, it will only run on XP and I'll be forced to upgrade.