Changing the size of a device and updating the software is not innovation. A stylus is nothing new. MessagePad had an onboard stylus. The only difference is that it was included with the price of the device.
By your analogy, touchscreen on the first iPhone was nothing new as well, because other phones already had touchscreen on them.
What made the first iPhone different was how Apple made all the various technologies work so well together. That to me is the hallmark of Apple innovation - taking an emerging product category with a frustrating user experience and delivering a polished product made possible by its control over both the hardware and software.
The Apple Pencil may not be the first stylus, but it was first stylus that didn't suck to use for me. Up till the iPad Pro, I was content to use my fingers to write in Notability on my iPad because other styluses were just that bad. That to me is meaningful innovation. Innovation that I can get behind and which has a noticeable benefit by letting me get things done in a way that I never could.
Apple Watch was never relevant.
A product that is second only to Rolex in terms of revenue, and growing adoption numbers in a market that is seeing the other wearables manufacturers dropping like flies, is not relevant?
The Apple Watch looks set to form the hub of the next wave of wearable products by Apple and you think it's not relevant or meaningful?
But Apple keeping around a tiny MP3 player whose capabilities look set to be cannibalised by the Apple Watch is innovation to you?
This is just Apple jacking up prices because they cannot innovate.
Just last year, I bought the 9.7" iPad Pro, Apple Pencil, Apple Watch and AirPods, and am still happily using them. Not cheap, but they have since more than paid for themselves in the form of greater productivity and fewer problems overall.
For a company that supposedly "cannot innovate", they sure have no problems getting me to buy their products over the rest of the competition. And they are all working great for me, considering they are from a company which supposedly "cannot innovate".
At what point do the Apple critics here finally come to the realisation that perhaps it is them who are hopelessly out of touch with technology, and not Apple itself?