Let me see if I can summarize the debate, y'all...
Wireless only
PROS:
- no cord to tangle up and restrict you
- frees up a tiny bit of space in device (note: this seems to be an advantage only in small devices like phones; although in the iPhone 7 Apple doesn't seem to fully utilize this freed up space, indicating space may not have been such a major motivation for Apple)
CONS:
- battery needs to be kept charged (and any extra battery peripherals need to be carried and kept charged)
- lesser sound quality
Wired and wireless
PROS:
- gives you the option for whichever you prefer
CONS:
- doesn't push forward wireless audio technology as hard
- takes up a tiny bit more space in device (see above note)
But it's these questions that make the debate impossible to resolve at the moment:
- do most people care more about the wireless advantages or the wireless disadvantages?
- does wireless audio quality have a good chance of catching up to wired in the near future?
People and even companies think differently about the answers to these questions, but really only time can tell us.
You've pre-conditioned your conclusions based on your personal assessment of the size of the headphone jack.
Nevertheless, the iPhone 7 may not make full use of the space, but then again, in the space it has left, a headphone jack would not fit. Could they have engineered it differently? Probably, but likely not without making the phone larger, and basically redesigning the phone, which they did not want to do. This move also sets up the changes they intend for the next complete redesign, which may have zero additional room. Further, Apple claims the plastic part filling the "unused" space serves an important function to equalize the pressure of a more water-tight enclosure. Either way, there does not appear to physically be enough room for the jack, whether the plastic part is needed or not.
The 7 Plus is slightly different, and is bigger, so they likely could have found a way to squeeze the jack into it without changing the outer dimensions, but that would have led to more fragmentation. Apple wants a clear break with the headphone jack, and supporting it on one iPhone and not the other sends a mixed message. Likely it would have to be dropped with the next redesign anyway, so why make it an issue now?
In the end it's not about the advantages of wireless or wired, or even quality of audio, but how many people will be inconvenienced by having to deal with the lack of a standardized 3.5mm headphone jack. And so far I have not seen any data that gives a clear indication of what the majority of mobile phone customers would prefer. Without that data, all of this is subjective. In the end, all that matters is what Apple wants to accomplish, and how many of its customers the decision impacts. If 20% of Apple's customers will be inconvenienced to the point they will switch to Android, Apple has to decide if it's worth pressing its agenda. Apple removed the DVD drive, despite the fact that many of its customers still use CDs and DVDs, so as long as that number is something they can live with, it's the right decision for Apple.