I think the problem is that the intelligence of a group is defined by the minimal intelligence of its members, not by the average. If you have even one member who just doesn't get it, then everyone else needs to dumb down their ambitions so that he doesn't get left behind. That's why the "no false positives" rule is so important in startup hiring, and why the public school system sucks so much. I think it's a fairly good bet that with 25k employees, the dumbest person at Google is dumber than the dumbest person in FaceBook. And with Google's shared infrastructure, it's fairly likely that you'll run across some design decision made by him.
there are recent, fairly inexperienced hires doing amazing things
Maybe, but is that true of the average new hire? I'm sure Google is still hiring a fair number of smart people who will do amazing things; my argument is that the average has dropped. You can cite individual examples of smart people but those aren't a counter-argument unless you have a statistically significant number of them.
Remember, if you're going to use free food and candy stations as hiring tools, don't be surprised when the type of people you hire are more interested in eating free food and candy than building something awesome.
As an early-stage startup guy and hired gun, my outside perspective is of course biased towards the smaller company, so take this with a grain of salt:
I think the main thing is that Facebook has a unified product and vision, with really strong UI, and a lot of hardcore infrastructure all centered around a global experience. Meanwhile Google has one strong business, and is repeatedly throwing spaghetti at the wall to find new areas to expand to. Sure there's a lot of great products there, but nothing with the potential Facebook has.
On the other hand, hackers (myself included) value raw utility highly and maybe on average we just prefer google search and google maps as tools due to the vapidity of Facebook. I certainly feel that way.
However, comparing the impact on the larger world, I really really think Facebook has made way more impact than we care to admit. They got the whole world on a single social network. They created the newsfeed, some thing which is ubiquitous across all sites now. The Facebook platform, though buggy and heinous was completely revolutionary when they launched it. They created a single sign on that is used by a staggering number of people across the web.
Personally, Facebook's innovation over MySpace is every bit as impressive as Google over Altavista or MapQuest. We may not value the ends, but 500,000,000 users with orders of magnitude more engagement than Google is undeniable impact.
When everyone is super smart, it's great but it's also a curse. It's hard to get anything done because there is always someone very smart to find one possible reason why it should be done differently. Think of it as the curse of perfection.
I witnessed this firsthand in a previous life. It's amazingly frustrating, because it's so counter-intuitive.