1. Ubuntu (Kubuntu etc...) is over all better than the best from Microsoft or Apple. Yet, most people still never know this until they try it and use it a while. Many will not. Non-technical people (most people) want zero effort, zero time and zero risk. That's just the current reality. Besides continuing to improve *ubuntu, leaving no real benefit behind, and providing new and better real benefits, how can we do this? Else, at least get close to zero effort?
2. Historically the live CD was a step in the right direction but many regular folks are never going to burn their own CD or even wait for the mail. If you give them a CD, they will not even install it or even test the slow live demo. If they do run live, many will never install. Why should they change? They can't see why, until they use it. Catch 22. Still as far as we've come, it's still out of reach. It's sad but true. People hate change and are slow to change. They will not even buy a computer pre-set with Ubuntu (or other) because again, they can't know. They have never used it. You can encourage them till you're blue in the face and still, they don't have time and they are a slave to the many myths. So how do we get them using and therefore myth busting?
Other than Wubi, there about Three ways that come to mind.
One is a java (or something) Kubuntu that runs in any web browser. This might require the most development effort and it would technically be a different animal but it could be made to exactly emulate the look and feel (and speed) of Kubuntu (that's the whole point) and just by clicking a link (auto loading, installing and any required browser plug-ins.) The whole point is it would allow many or most, of the actual (same working and be called Ubuntu "instant" or something) benefits so that a user would clearly see why a regular install would indeed be wise for them. Perhaps for certain needs, people could just use this as is.
The second possible way is related, and a cloud/internet browser based, Internet set of programs (open ones) that is labeled as "Ubuntu Online" (or something) that also looks and feels enough like the regular installed Kubuntu/ubuntu to motivate a massive shift. Remember the point is (nearly) absolute zero effort; on the part of the new and non-technical users (most everybody.)