I think we can safely guess what the Monday morning water cooler talk will be about town -- the stunning upset by Happy Feet in the Best Animated Feature category. While Cars wasn't quite seen as the lock that, say, Helen Mirren was, few doubted John Lasseter's film would take home Pixar's third Oscar for in the Animated Feature category . . .
We can only guess what tipped things away from Lasseter and in favor of George Miller. The Academy is overwhelmingly dominated by live action film professionals, and Mr. Miller is one of their own. Much was also made of Happy Feet's emphasis on the use of live-action cinematography techniques (apparently unheard of in our backwards industry), and of the live action actors and dancers who provided the motion capture data for the animation (well, of course animators can't dream of providing great animation without real actors to help). Many loved the environmental emphasis of Happy Feet (I even had one person tell me they liked that it dealt with global warming, which of course it didn't). And it probably didn't hurt that 2006 was widely seen as a fairly weak year for animated films, despite the large number of major releases.
Pixar was also shut out in the Short Animated Film category, as were fellow major studios Blue Sky and Disney. Not too big a surprise here, since this category has usually been seen as the natural venue of independent, personal visions. So Torill Kove's The Danish Poet, a co-production with the National Film Board of Canada, was no surprise.
[In case you don't remember the previous Oscar winners for Best Animated Feature: Shrek, Spirited Away, Finding Nemo, The Incredibles, and Wallace & Gromit: Curse of the Were-Rabbit.]