Regarding setting our own background on our profiles, synths are able to be embedded just like other web media, so if you want a page with a custom background image and your synths featured on it, there is nothing to stop you from making your own webpage where you embed your synths, such as a WordPress, Tumblr, or Blogger blog with a custom theme or your own custom site. For that matter, you can access your synths' thumbnails and display the full squares there if you wish.
Photosynth has chosen circles as their design theme and uses it for everything from their new logo to the thumbnail shape to the icons.
The universe is chock full of circular and spherical things, so there's nothing invalid about using circles as a design element.
I, for one, am glad that someone at Microsoft is not just slapping colored squares on a screen, thinking that this qualifies as good design.
The Zune team understood that not everything needed to be enclosed in a rectangle.