Using LFS as a starting point, Luis and Mike were able to build a minimal Linux kernel that included only the functionality required by the "kiosk style" machines.
So rather than just recompiling the kernel in an hour on say, Debian, they built their own distro? If the hardware runs '98 and NT, I can't imagine why you couldn't use existing distros to speed development by several magnitudes.
Sorry if I'm out in left field here, but it sounds exactly like the type of project you slap people for. I think it's referred to as YARW, 'yet another reinvention of the wheel'.
At least security reports and updated binaries won't be available unless or until these guys create 'em. Brilliant, in the autistic head banging sense of the word.