As a programmer, and person, I hate reality distortion fields. This blog post is meant as an exercise in building skills to see through it.
First, the post was not just Steve, sitting in his office, jotting down a few notes. He's thought about it, long and hard, carefully avoiding certain areas that might cost him points, while pushing the strengths of his position. Lots of my stuff here is off the cuff, and might qualify as a jot... his definitely is not something quick and dirty.
First, there is "open", as Steve said. Just how do you send code to someone who owns an iPad? It appears to this observer that the way is definitely not open, but only goes through the Apple toll both. Open ports like USB would be nice too.
The there is the "full web"... Flash sucks because it's a layer between the web and the browser. It's a shim at best. However, it's the best shim out there for most cases. Allowing flash, with some disclaimers would be far better than denying the use of this shim.
Then there is security. If you can't protect your iPad from bugs in Flash, you certainly can't protect it from any other rogue applications either. It's just a matter of time before the holes start showing up. Steve - read up on Capability Based Security.
Battery life - good point. Hardware acceleration is good. It would be nice if I could replace the battery at some point as well.
Then there is Touch - If you don't allow cross compatibility, how are others going to figure out how to deal with touch? You'll always be a special case, and never mainstream.
Conclusion - Steve is good at distorting reality, but it's a near field effect with limited range.