The marketshare argument does not hold any water as, for some reason, you are considering feature phones alongside smartphones. The two are fundamentally different devices.
To be frank, the main reason why Symbian and other legacy OS failed to compete with Android in this new market is accumulated tech debt and just overall technical and design decisions made over the years to cater to feature phones.
It wouldn't be impossible to overcome that handicap, but why spend more money and even more importantly time, to try to fix something when you (a) have the option of a more modern platform in Android (b) you already are starting from behind and need to catch up to Apple.
Google were generous to give the terms that they did. But even if they didn't, it wouldn't have affected the outcome. Perhaps 1-2 OEMs would've tried to go to market with a retrofitted Symbian and fail within a year or two.