Cabling, plumbing, etc, aside, all the "blade servers" I've ever worked with were still glorified IBM PC's. They still have BMC's strapped to legacy interfaces pretending to be decades-old hardware allowing for "headless" operation of a platform originally intended to be a single-user computer on a desk with a monitor and keyboard, etc.

That's what's so cool about Oxide's boxes to me-- the legacy garbage is gone and the strange undefined behavior part and parcel with overlapping edge cases will be minimized (and managed, as opposed to used as an excuse by a vendor). Dealing with incompatibilities and strange firmware interactions have made me come to see PC-based servers as a weird opposite of the "Swiss cheese" model. The various layers of interacting hardware, firmware, drivers, and OS act as a kind of "filter" for correct operation. When you swap or add one of these component you get one or more exciting new layers in the stack that, hopefully, have "holes" aligning with the existing.

Forgot how I learned this but IIUC, blades failed because they expended per-rack weight and power budgets for datacenters with single enclosures. It turned out that you could compress 48U worth of computers into 8U or so, as long as you do not fill back the empty space with anything, because the cooling/cabling crawlspace collapses and circuit breakers will go off if you had done so. It wasn't because they still needed cabling.

This sounds like less of a problem for DCs with bare concrete flooring, but blades did fell out of fashion, so I guess the fractions of DCs with multiple levels or free-access floors were higher than anticipated.

(Also, maybe I'm just being an amateur, but I'd be scared of tolerance stacking with a "grape bunch" design like this. Individually enclosed chassis with cables and cage nuts are a lot more robust against dimensional issues)

Speaking of the army, it's not clear that the extremely narrow feature set of Oxide justifies the engineering effort required.

The storage market used to be dominated by Oxide-style vertical integration and bespoke engineering and almost every vendor has transitioned to modularity over the last 20 years. Pure Storage seems to be doing OK with custom hardware though, so maybe the rest of the industry just has a lack of courage.