Actually, real measure = content + padding + border + margin (forgetting the border will bite you every time).
Good news, though -- CSS3 will probably allow us to get back to the intuitive border-box model (where the height and width denote the external dimensions of the content box plus the padding plus the border) if we want using
That's the way it should have been in the first place. No, MS didn't "do it wrong", they invented CSS. Netscape wanted to use JavaScript Style Sheets. Netscape lost, but they were influential enough to make sure that the CSS standard RFC didn't exactly match what Microsoft was doing. The content-box model has always been a disaster from a design/layout perspective, but it was easier to implement in the JSS-to-CSS translation layer in NSN 4.x since it cut down on the recursion. NS never did get CSS support right in Navigator 4.x (their recursion reluctance meant that a style for TABLE didn't apply to a TABLE in a DIV) but they did manage to screw up the standard AND get everybody cursing MS at the same time.