As reported by C/Net:
"In the first period--June, July, August of last year--there were some in the retail channels that were shipping (Netbooks) as notebooks," Sean Maloney said in a question-and-answer session that was streamed over the Web. "They were running ads that had a continuum of notebooks and had this Netbooky thing in there--it was called a notebook. They had very high return rates and a couple of these guys had return rates in the 30 percent range, which is a disaster."
The return rate for the MacBook Air - which is considered Apple's current closest competitor for netbooks is higher than Apple would like and the "Air" is pretty full featured.
Most of the Netbooks I've seen - like the HP Mini and Acer models - seem like kids VTech laptops in build quality.
Full story here: Intel: Some Netbook resellers saw 30% return rate