the app fragmentation problem is reason # 1 that it won't happen. It's a big issue. For that reason alone, it won't happen.
#2: They would lose their profit margins. Say they make a 4" model and a 4.8" model. Sure maybe they would sell 20-30M of the 4.8" model... but what is the net gain of consumers. Meaning how many people wouldn't have bought a 4" model anyway, if it were the only option? Maybe 5-10M? Now say apple makes a mini 3" model as well as the 4" and 4.8". Sure they may sell a few more, but there is diminishing returns. It takes a lot in R&D, manufacturing, etc for each new product. Apple is struggling to manage demand already.
#3: Apple is convinced 4" is the largest you can get one handed operation (and I agree). Apple isn't the "choice" type of company. They pick what they believe is best for the consumer and shove it down their throat. Typically they are right. It's not quite a one size fits all, but it fits most and that's good enough for Apple.
I, personally, think that any size from 4"-5.2" is kind of an awkward size for a phone. It's too big to really be used one handed, but it deceptively makes you think that you can... untill you try to touch something you can't reach. If you need to use both hands anyway, just go for size. That's why I think the 5.5"-6" phablets actually are a very interesting and potentially promising market. They tell you upfront "I am a two handed device" and you get a good amount of screen real estate for it. Sure it makes kind of a terrible phone, but I find myself using that feature less and less. I think an iPhone/iPad mini combo is awesome. But it's still two devices. Would a 6" iOS phablet be an ideal one size fits all? or would it be a terrible compromise that tries too hard to be something that it's not? I don't really know