Because of power. It may have "workstation tower processing" power, but it's not hooked up to a wall socket. Power consumption is the gigantic bugaboo that plagues mobile devices, and that (in my opinion) justifies Apple's policies about background processing on iOS.
All of us have experienced how much you want to tear your hair out over lag (especially in iTunes). I think iOS eases that experience because there only is so much you can do at once and you always feel like you're in control in an environment that Apple actually controls.
An iPhone that's smaller than my still-pocketable non-Apple phone isn't that appealing to me (yay for having above-average-sized hands!). An iPhone that could go a week easily on a single charge would make me sit up and take notice, though.
It's truly just an incredibly hard problem to solve.