It's not a bad dream. It's not a lame joke. It's real.

When Microsoft (NASDAQ:MSFT) hired a former Wal-Mart (NYSE:WMT) executive in February, and tasked him with creating a line of retail stores, I wasn't the only one who found the move to be stupid.

If you're like me, you figured that the venture would be abandoned after a rudimentary feasibility study. Well, just as some bozos at Wise recently gave the green light to honey barbecue Cheez Doodles -- trust me, they're raunchy -- Microsoft is still bent on rolling out its incomprehensible mall chain.

Instead of orange dusty fingers, Mr. Softy's going to be red-faced after this.

Making matters worse -- or funnier, at this point -- Microsoft is picking the worst possible mall neighbors.

"We're going to have some retail stores opened up that are opened up right next door to Apple stores this fall," COO Kevin Turner told developers yesterday.

Apple (NASDAQ:AAPL)? You can't be serious! Talk about a gamble. I've been to nearly a dozen Apple stores, and they're always buzzing and crowded. Can you imagine if the Microsoft store next door isn't as lively?

If Microsoft can't be cooler than Apple, this is going to be a colossal fiasco. What happens if even diehard Redmond rooters are embarrassed to be seen walking into a barren Microsoft shop?

I'm sure Microsoft has thought this through. Right? It's seen how the "I'm a Mac!" ads have jabbed at the company by placing cool Apple alongside the clunky, chunky Microsoft. The world's largest software company can't be dumb enough to perpetuate this image at the retail level.

The only way this works is if Microsoft pushes its coolest gizmos -- like Surface touchscreen tabletop computers and an Xbox 360 gaming lounge -- to the front of the store. Bury the guts -- like the Microsoft Office 2010 and Windows 7 demos, and especially the dust-collecting Zunes -- toward the back of the store.

Microsoft's store aims to be more of a product showcase than an actual retail hub, but that can't work. If there isn't buzz around the register, or if folks aren't walking out with Microsoft bags to brandish as they walk through the mall, the ambassadorial efforts will be wasted.

Can Mr. Softy show off its upcoming Xbox 360 titles without angering the GameStop (NYSE:GME) a few stores down? If it finds itself at a suburban strip mall, can it market webcams and software without angering the Best Buy (NYSE:BBY) anchor?

How can this work, when there's such a delicate balance at play? The stores have to be cool, but they also have to be Microsoft.

Is it too late to trash the plan and just go with a chain of Mr. Softy ice cream parlors?

The world according to Microsoft: