Microsoft don't sound like the problem.
Its not a matter of "correct", its a matter of what people bought into when the initially decided to support DNT.
A browser should protect my privacy, give me tools to filter out content (images, ads, off site material), protect my browsing history, etc...
This is all besides the point - when every browser sends a flag that states "Do Not Track" - then "Do Not Track" loses all meaning.
The setting has to be either on or off by default. I think that most users, if asked, would like for it to be off. The only reason to leave it to "on" involves advertising doublethink, a.k.a. bullshit.
The advertisers agreed that as long as the flag had to be set manually by the user the would honor it. They made that agreement because it would not impact their revenue significantly. It would be very presumptuous to expect them to voluntarily destroy their own business. Because DNT is optional you need the advertisers and publishers to agree about it. So by making DNT on by default in IE advertisers walked away from the agreement and their is nothing we could do to stop them effectively killing DNT.
Now you mention most users don't want to be tracked, but what are they getting in exchange for being tracked? If you asked the average user would you allow your self to be tracked online to use Facebook I be most would say yes. How about you allow yourself to be tracked on line for 1 free latte at Starbucks/month? Again I think most would say yes.