As an internet tablet... not a client for an an app delivery system.
Again, it is a question of priorities.

Transition animations hide a lot as well...
EDIT: I see ARJWright pointed this out a page back. These are some of the tweaks and optimizations I spoke of earlier.



We are just now seeing other manufacturers and OS's embrace the internet tablet with mobile internet anywhere that Nokia focused on 4 years ago.
When it is all said and done pinch to zoom might not have been as necessary on a higher res display, the iPhones eventual shortcomings may very well become it's browser and screen resolution.

5 years ago a lot of the iPhones customer base still didn't fully understand the importance of, or utilize the potential of the internet in their own dang homes let alone a mobile device.
Nokia's 770 first provided the platform for a fully functioning browser. J2ME had been around for almost 10 years then as an app delivery client and it went nowhere.

What Nokia and anyone else didn't understand then was that the customers were there but the carriers and providers controlled what platforms the apps were to be delivered to. Sun as well as the carriers also wanted to big a piece of the revenue pie.
A fart app in JAVA would have sold just as well in terms of saturation 5 years ago to users of JAVA enabled phones as it does today on an iPhone. It would have pro'ly been easier to code as well.

I think this is what Jobs saw and the iPhone was designed as a client for iTunes. Nothing more.

The corollary to all this would be the question: How come my wifes iPhone can't display all the sites my N900 can and why is there no Flash?

Predicting what customers will want is a difficult thing. Giving them what you want is a hell of a lot easier.

BTW, I'll now try my predicting abilities:

I predict some knucklehead will follow this post with some sexist comment regarding my wife and her choice of phones.

How did I do?