But people know it's gone so they won't be upset if it's not at E3.

I've said this before. MS can give away every Xbox One they have for free and it wouldn't break their bank... okay maybe a little but still that $399 is plausible.

That all sounds good, if it all really works out like that. But, a $399 price tag is far from guaranteed, and it seems unlikely that people will have nothing but positive things to say about Xbox, just because they already put out all of the bad news. The fact that there is little going on (if that is truly the case) is not going to go over well just because we already know about it.

They need a killer new IP that gets people buzzed and can use to showcase Scorpio, or I really don't see much of a chance for it to compete with Switch/PS4.

no they did not

I agree, a new IP or 3 would be the big show stopper.  The point to me really is that if you clear out all of the other negative things before E3, whatever you do announce will get the center of attention.  I would hope for MS sake, they have at least 1 new big game to show that nobody knows about.  If they have 2 or 3, the focus will be about games for the media coverage.  It won't be about all the things that were missing and "oh yeah they have a new game or two".  

Unlike others, I don't see the Switch as some dominating force.  To me, it is really just the next iteration of the of the DS/handheld.  Hell, I can do all of its features with my iphone from 5 years ago.  But, being a handheld, they sell fast and people are calling it a console so it gets lumped into the XB1/PS4 bucket.

The big play for MS is really the Universal Windows Platform(UWP).  That is where MS sees the future, maybe 5-10 years out though...