A smartphone doesn't have any certain things that make it a smartphone. It's a name thrown out for sales. There are flip phone smart phones even. Really all a smart phone is is a phone that does more then what a normal phone does. Back in 1998 there really wasn't much you could do with phones other than change the nokia color casings so once phones started to be able to do more things, they branded them as smart phones. So yes, when the iPhone was released it was a smart phone. Just because you didn't think that it was doesn't mean it wasn't.
My SE w810 and more would do about everything the first iPhone could, yet it was not dubbed smartphone.
Don't mistake "Feature Phone" with "Smart phone". While there is no agreed standard definition of a smartphone, most everyone in the industry agrees that Apple first released a feature phone, not a smart phone.