It appears going by the 2 images that have so far been released showing Paint and WordPad that Microsoft have decided to extend the Ribbon UI used in the Microsoft Office Suite to the included applications in Windows 7.
It’s a small change, but it shows that with Windows 7 Microsoft are willing to try new things. The Ribbon is a fairly handy part of the Office UI, in the case of WordPad it will allow people who are familiar with Word use WordPad much quicker.
I don’t believe the use of Paint will be more productive necessarily, as previously in Paint there was only 1 layer to most of the functionality, however the upside is that this allows Paint to increase in features if necessary without having to have yet another UI change.
Overall I believe it’s a nice addition to the Windows UI, even if it only affects a few applications, I look forward to seeing more of Windows 7 Milestone 3