There are enough comments here that pretty much establish that there is a problem, and I have seen many more comments in other forums around the internet. Reciting specs is neither solving the problem nor even admitting that there is a problem. It could be something where it is hard to establish the cause. Years ago there was a battle for the best mp3 player, and all of the contenders were trying to get Apple to buy their code. One of the contenders was an player called Audion, who felt that it would be the one picked by Apple, but at the last moment Apple made a deal with another company which became iTunes. I don't want to go into details, but you can read about it on the Audiion web site at
www.panic.com/audion. Anyway, the programmer of Audion to this day keeps reading how mp3s sound so much better using Audion. He mentions on his web site that it really makes no sense to him, why one sounds better than the other, because he has looked at the code for both, and can't figure out why. But to this day, I still use Audion, even though it is no longer supported, and it sounds so much better. For a while, I thought that it might be my sound tastes, but everyone I have had listen to it agrees. I have a masters degree in electrical engineering, and I know how hard it is to find a solution to a problem when you can't find the problem.
But that being said, I have also had dealings with Apple who plays every game to save 10 cents. For years I developed databases for one of their over priced database applications called Filemaker. I was even rated as one of the top 6 Filemaker database developers in the country, and had access to some of their programmers. For decades there were bugs and problems with the database that never were fixed. I would often ask one of their programmers why they could not fix a problem. The programmer's response was always that they could probably fix the problem in a week or so, but Apple would not let them do it. A few times I was able to have them fix a problem for me, and not tell Apple about it, which only I knew how to use, because they could loose their job if Apple knew. Another very big issue about Filemaker, is that when they come out with a new version, it is not backward compatible, so you have to buy the new version, and spend months or years redoing your work. Imagine that you typed a letter in a word processor, such as MS Word, and then a new version of that word processor comes out, and you have to retype the letter so readers can read it, and they also must buy the latest version of the WP. That is totally insane, but they have been doing that for decades. You can spend a year developing a good database to sell to customers, but by the time you are finished, you must go back and redesign it, because they no longer sell the version of the Filemaker that can read it as it is. That is the primary reason that I stopped using their product to develop databases.
The bottom line, is that my guess is that they know the quality is not great, but it is cheaper not to fix it, because the vast majority of their customers do not really know good sound from bad sound unless the can actually compare, which they seldom can or even care to. Apple can also come to these forums and try to convince everyone that the user is the problem, instead of the product. Since music is such a big enjoyment in my life, I have held off buying the new G4, because my wife has one, and the sound is still bad. I am willing to give up a few features, and since I am out of contract, I am looking for another brand smart phone that has better sound quality, and probably even cheaper, with a better carrier such as Verizon. Apple's battle with Adobe over Flash is another issue, as well as their antenna problem that they also denied existed, and said they have no intention of fixing. Apple is just too greedy for my tastes, and pretty packaging is not going to continue to sway me forever. They sell based on hype with no real concern for real quality, or the consumer. The things they are good at are R&D, innovation, and marketing, though I have a feeling that will start to change in the near future as other companies follow their lead, with improvements. There are many new features up and coming, and it will be interesting who comes out with them first vs who makes them better. I expect the next big changes for smart phones, will be tactile feel on the screen, pressure sensitive screens, 3D, etc., most of which are already in testing. The only thing that I can give Apple kudos for recently, is the very high resolution of the 4G screen, where, if you are not far sighted, you can get close enough to read a complete 8.5 x 11 typed page without scrolling. Maybe the best solution is to have 2 smart phones, one for doing some things, and the other one for good quality sound

But it is a shame that you can't get it all in one device, because the company wants to save 10 cents. Especially for how much more it costs than the competition.