I went back and re-read the original quote, so, unless he changed it I misread it. I thought he was talking about Applications in general not specifically games. He's right in that the Pre SDK does not support 3D right now. They said they are working on it. How long? Who knows.
As for Applications, I haven't used the SDK myself but DataViz made a Microsoft Office document viewer AND EDITOR. Another company wrote a Palm Classic emulator. Both of which are extremely complex applications.
First, some companies can get preference treatment, so they don't need to be constrained by the SDK.
Second, a complex app can still be written with a very high level SDK, but a simple app may require deeper access to the OS. Productability apps (like Office doc editor), however complex, only need the access to the file. The display can be handled by HTML/Javascript.
However, let's take a simplest app from iPhone - Sonic Lighter, or iBeer. They cannot be done with HTML/Javascript.
Emulator requires direct access to the OS. There is no way to do with at the HTML level. The company got Palm' blessing and is running directly on the OS. Palm probably paid them to do it.
As the other person said, the WebOS SDK is like Dashboard SDK on iPhone, very limited.
Android SDK is better than WebOS SDK. You can do way more with Java than HTML. Then, iPhone SDK (and Windows Mobile) are way more powerful than Java.