OK -I'll bite...
I find myself grasping for something in the middle, hence in part my interest in running LK on Java.
As an analogy, think about how effective Firebug is, being built into the browser. I'm not discounting Firebug for LK development (and perhaps a Firefox extension for LK 'development' is a good idea...), but Java seems to offer even more opportunity for getting down under then hood of the browser (whilst still having a practical deployment path)
For a development environment, first you will require a worldview where we separate "users" and "developers". Developers will require the usual aeroplane cockpit style IDE. Users will simply need to be docile and run an emasculated netbook, preferably one provisioned exclusively by a single app store. This device need not have much in the way of a processor because any computation they could ever require is obviously best done in THE CLOUD.