I cant believe the people who are discounting the PowerVR SGX543MP2 Dual Core GPU. Thats by far the next most important component, after the processor.
All the fluidity of the UI, smoothness of scrolling, video output, etc, is all driven by the GPU. It's because of strong GPUs and hardware graphics acceleration that Apple has gotten this far to begin with. Take away either, and you might as well be using Android. Because Android software renders, it sucks the battery 2x as fast.
People need to get a clue before discounting the very reason they like the iPhone.
It is this which provides the experience, as you say, the smooth scrolling etc. - and people want the experience.
However, most people don't really care where the experience comes from. It could be powered by a petrol engine or a fly's brain for all they care, as long as they get that experience. So while what you say is all true, it isn't the thing that people are looking for.
... If that makes sense.