I appreciate what you are saying about a 'deeper OS' with Android, but in the grand scheme of things its only a very small number of consumers who demand the levels of freedom that you guys discuss here. Not 'everybody' (there's that word again) is into the geek stuff.
The reason iOS sells so well is because it works so well. Sure you are restricted in comparison to Android in terms of more technical stuff, but what exactly do most people need to do that they can't on an iPhone? I'm yet to find something where I think, wow I wish I could do that. I can text, email, look at all my social networking, make calls, change the wallpaper if I wish, surf the net, use a variety of apps, facetime friends and family, listen to music, use as a sat nav...The list goes on. The way I see it Android is just a different OS that allows the user to do all the things I have listed, just in a different way. Basic tasks really. I know there is a competition here to prove why one is better than the other, but in all reality both OS's serve different needs in the market and I can't honestly say one is superior than the other because I've used both and know what I want from a personal perspective. What I want may not be what others likes and vice versa. Its just personal taste and nothing can really be crowned as king here.
If you want to be so superficial about it, then it is also true that nothing that an iphone can do that a dumb feature phone can't. Just like in a exam, it takes minimal effort to pass but to excel you need to put in hard work. Iphone can easily passed the exam but it can't really excel because it just does not do some things well (or efficiently) or has the extra capability to make it stand out.