We have been building/installing VPON systems (Linux DOM) for the last 3 - 4 years. The ease of DOM's have made us stay away from Windows systems. That said some pros and cons on linux: 
  
Pros: 
1. OS not HDD dependent 
2. Don't have to pay for the OS  
3. Fast COLD BOOT  
4. User friendly - specially using the IR Controller 
5. Truly Plug-N-Play 
6. Remote Firmware Updates 
7. GUI customization using local/remote FTP 
8. Minimum/No installer/user interaction - post installation - no windows updates, AV, etc 
9. IDIOT Proof and dedicated - hard to mess up the DVR Core even if the user tries hard  
  
Cons: 
1. Need specific hardware - specially VGA and Audio Cards 
2. Web Servers are not that Windows friendly - specially with Vista (ActiveX signing issues) 
3. Video quality not up to par with windows contenders (similar priced) 
4. Need a Laptop or linux/windows boot (rescue) CD to work with the DVR HDD's 
5. No multitasking - PC becomes a dedicated DVR -  
  
These are some of the pros and cons off the top of my head and based on the VPON DOM Model.