This allows it to be cheaper and means the device itself is less prone to bugs & software glitches.
For the more advanced, you've got the Android TV Operating System - on the Nexus Player and other Android TV manufacturers, or built into some TVs.
I really rather like my Nexus Player, though.
No, that would be the Nexus Player.
The CC competes with other streaming sticks...like the Fire TV stick, Roku Streaming stick, etc.
Last night, I was watching something on Netflix on my Chromecast (using the Android app) and somehow the app and the CC got out of sync. It thought it wasn't casting anymore, so it took away my playback controls and I had no way to pause my show. IIRC, eventually I had to turn off the TV (and thus the CC).
My TV also detects when the Chromecast starts casting and automatically turns on and changes to the input. Great if you want to watch something without finding the TV remote, but I've woken up numerous times in the middle of the night to find my TV on, just showing the Netflix title screen even though no devices are casting. Never had that happen with YouTube or Plex or anything else I use, so I wonder if it is just Netflix.
A physical remote for the Chromecast for pausing/fast-forwarding/rewinding is a pretty good idea. I wonder how difficult it would be to interface with the Chromecast and make a WiFi remote? Or would it have to emulate the signals that the app sends over WiFi to the Chromecast? I wonder if you could sniff the packets for pause/play/rewind and emulate them? (I smell a good idea for that dusty ol Raspberry Pi that I have on my shelf)
Also note that the Roku has an Android app that allows you to completely avoid any on-TV UI, if you so choose.
Can you cast to Roku through Netflix/YouTube/etc? It's not the on-TV UI that I don't like as much as it is that I like browsing through Netflix on my phone much more. I know with the Xbox One (and the 360) you can cast Netflix and YouTube to it just the same as you would to a Chromecast, so it wouldn't surprise me if other devices implement the same functionality.
No, its intended as an incremental upgrade to the existing Chromecast.
The related product most similar to AppleTV/FireTV/Roku (in price and features -- though still less expensive) is Nexus Player.