Enough of the "too much emphasis on thin" whining.
Let's reverse it for a minute.
What do most users need?
How much are they willing to spend?
What flexibility is required?
What is the optimal implementation of those needs?
How much space is required for the solution?
How to package that solution?
Of the millions of iMacs sold, very few need/want anything other than an i5 or i7, 8-32GB, fast 1TB, a few fast interfaces, a strong (but not screaming) GPU, and a nice screen. Other interfaces are obsolete, or rare enough to warrant a cheap dongle. Optical drives, between disuse and the Bluray "bag of hurt" issue, are moot for most.
They'll spend $1300-3000ish.
Later memory upgrades are the most common, and rare at that. Storage upgrades are mostly external at this point, esp. with USB3 & Thunderbolt. A processor upgrade really needs a new motherboard etc to be sensible.
All that can be packaged into a pretty small space, with a couple inches depth.
Eliminating screen glare, and new display tech, gives a crazy thin screen.
So you end up with an AIO box with the guts crammed into the space of a couple packs of cards stacked, and a 27" screen millimeters thick.
Addressing optimal creative cooling solutions, taper the back in an elegant form from maximum thickness to those 5mm edges, work in audio & airflow.
Forego most upgrade ability due to cost, volume, and complexity introduced (non trivial).
And the 2012 iMac is the result.
It's not "why did they focus on making it so thin?"
It's "what else could they do? Why do it?"
Thin and "pregnant" was the sensible solution to the problem.