I suppose it's supposed to be "easier to use" or more fluid because all your interaction is "on screen". This is Marko Ahtisaari's mantra, anyways. You're right that there is still room for buttons, so removing them hasn't all by itself freed up space for the screen, though comparing the front of the N9 with the front of the iPhone 4, the iPhone does look a bit dated in terms of the amount of real-estate not being used for its screen.