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Yes, "thin-client" computing is stupid, has been tried many times, and has yet to succeed anywhere that requires a GUI (TUI and CLI environments like point-of-sale terminals work well). The local hardware is anemic (since everything is done on the server), the local "OSes" are horrendous (usually just an RDP client, or a web browser, or an X11 server), and the demand on the network and server are huge! Supporting more than 50 thin-clients with a single quad-core server is hard.
However, "diskless" computing gives you all the benefits of thin-clients (central management, central storage, central everything), with all the benefits of fat-clients (local CPU, local RAM, local video, local audio, local everything except storage). You don't need a skookum server, since it's just a file server. You don't need a skookum network (10/100 between client and switches; gigabit backbone between switches; bonded/trunked gigabit backbone to the server) since once the clients are booted, only files/apps go across the network.
It's really too bad that Microsoft has made it so hard (almost impossible) to network boot Windows, with user profiles/home directories on network storage.
Desktops should be replaceable appliances without any local storage in them to worry about.
(Diskless computing works so nicely with Linux-based desktops/servers. We have over 5000 of them in place already, with over 90% of all desktops -- staff included -- running diskless Linux.)