Apple invented nothing fundamentally new or unique in the touch world. Multi-touch, finger friendly UIs, inertia scrolling and all the rest was well known stuff. Most just hadn't been commercialized yet to the mass consumer.
Moreover, without Google's crucial help via Jobs' placement of his admirer Schmidt on his board, the first iPhone would've been missing Google Search, Maps, YouTube, and the original Google wifi/cell tower location method. Wouldn't have been very useful a device without those features.
Not your fault for getting that impression, but that didn't happen. All that Fadell meant was that Jobs had shown him an example of multi-touch on a big platform. Not that the large platform was later shrunk.
It wouldn't even have been the same hardware technology used. Not even close. A big touch table would've most likely used projectors and cameras, not the transparent conductive lines (and other methods) used in front of much smaller CRT and LCD displays.
Shrinking was not the problem. The difficulty was finding someone able to manufacture smaller screens in quantity. Although there were at least a half dozen touchscreen manufacturers at the time, most were geared only towards making desktop monitor sized touchscreens.
So when Apple needed a smaller screen multi-touch projected capacitance screen in 2006, probably only Synaptics and a Taiwanese company called TPK had the ability to ramp up enough production in time.
As it turned out, an established German company called Balda had bought half of TPK in 2006, and Balda was able to make a deal with Apple to supply the iPhone's original touchscreen.
