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As prices keep going down the Netbook Wars, staying competitive amongst a slew of Atom-powered mini-notebooks is a big challenge. While paying $500 for a Netbook was common just twelve months ago, nowadays, stripped-down yet still functional Netbooks are now pushing $300, headed by Dell and its bare-bones Mini 10v. Acer’s Aspire One aided define the Netbook to the masses, underselling the competition at $350, and the latest version cuts down the price (while slimming down the chassis) with the $298 Aspire One AOD250.

Just a couple of months ago, Acer launched the first 10-inch version of the Aspire One Netbooks, the AOD150. In Feb it cost $350, but it had its limitations: a terrible touch pad, reasonably bulky size because of a six-cell battery, and a keyboard that was positively cramped compared with the competition.

The AOD250 weighs less and is thinner than the AOD150 since it has a three-cell battery now, instead of six. The specs on processor, hard drive, and RAM are identical, but the new Aspire One’s more compact design makes it feel a bit less like a budget product.

Although it’s a decent-looking netbook, it doesn’t especially stand out as groundbreaking in any way, unlike what Asus did with the stylish new “Seashell” Eee PC 1008HA. On the other hand, the Seashell costs $429, while the AOD250 is $130 cheaper. That’s a huge difference in a low-cost product.

The keyboard feels comfortable to type on, and although it has a pair of full Shift keys (no ugly right-side compression), it’s still far from full size. As a result, the typing experience is more cramped than working on an HP Mini 110 or a Samsung N120. The keyboard could have gone fully edge-to-edge, and in the future we really hope Acer makes this shift. The touch pad is unquestionably an improvement: while it’s still tiny and inset, the bottom rocker button is much more clicky than before.

The 10.1-inch wide-screen LED-backlit LCD offers a 1,024×600-pixel native resolution, which is standard for a screen this size. Colors are sharp, and text and icons are crisp.

The stereo speakers, which are embedded somewhere within the Netbook (upon examination we still couldn’t find where the sound was coming from), are weak, both in volume and sound quality. While it’s not surprising for a Netbook, headphones are almost a must.