The UK-based Raspberry Pi Foundation has designed a tiny SoC-based PC, and production is underway. The Raspberry Pi uses a Broadcom BCM2835 multimedia processor, based on the ARM11, and should support Linux. It’s a little lean on RAM (128 or 256MB) for a general purpose PC, but the killer feature is the price: $25 or $35.
Feb 29 2012 update: The first batch of units, smelling freshly of formaldehyde, has been shipped to distributors, and the Model B ($35 US version) is now available for general sale.