GNOME, KDE, etc, are not my choice of UI... I'd much rather start out with a minimal system, and add the software I need/want instead of being forced to use a system with a preset applications suite containing all manner of software which I'll rarely, or never, use. Of course the developer of a marginalized UI will see doom and gloom in Linux' future, but I consider such views to be an artifact of perspective, especially since the Linux userbase is continuing to grow.

The fragmentation of the Linux systems is one of the reasons why I now use FreeBSD, and it's minimalist approach is exactly what I've been looking for over the past few years.

I don't really see how competition comes into play when comparing free, open source, software with proprietary systems such as OS X (certified Unix product) and Windows. These proprietary systems are mostly focused on profits, while Linux and BSD systems are (mostly) focused on stability and security.

Why are there no libertarian nations?

Human nature... There's always exploitive individuals who seek power and thus enact legislation which marginalizes liberty in favor of profit, or power.

At least that's how my damaged brain sees it.