I don't think smoother text (and pictures) is anything to be trivialized. I mean it actually looks much much nicer and (imho) comforting - I experience joy anytime I look at anything that's above the 100 or so ppi of average 1080p monitors.
People spend huge swaths of money on the looks of things that they'll hardly ever be looking at. Considering this, spending the money on a screen (i.e. something they'll litteraly be staring at for large periods of time) is actually a borderline-rational choice in comparision..
I experience joy when I can go online and check my emails when I'm in the bus or outside.
What I'm getting at is, priorities may vary. You might care for portability of checking emails outside, I'd rather have crispy text because I'm working with all day inside.
If there's more resolution than the display (or the observer's eye) can support, the extra resolution can be used to make diagonal lines look better (as one example), through a sophisticated drawing method that eliminates jaggies. I'm not saying this is always true, but it's on the list of options to exploit the extra resolution.
> I mean it increases battery usage, it costs more, and all you get is smoother text and smoother pictures on a less than 5 inch screen.
That's pretty much it. But consider that people who buy Apple phones know they're not buying the least expensive, most cost-effective devices, so maybe they expect to get something not present in the bargain phones, like resolution that no one can possibly notice. Sort of like having a refrigerator whose light stays on when the door is closed.
http://blogs.discovermagazine.com/badastronomy/2010/06/10/re...