Sorry, I just don't know from where you arrive at this conclusion. You seem to be looking at the entire landscape of Android phones and not paying attention to how well any particular model is selling, when it's selling, and for how much. Sure, you could go buy an old Android phone for a nice discount, but you can do the same with the 3GS, and I wouldn't call that a crappy freebie (and I'd be amazed if people buying the 3GS now are current smartphone owners).

I think my problem with what you're saying is that you're arguing two things as a single, inseparable argument: that Android's brand isn't the draw so the platform is living on the sales of freebie/heavily discounted phones.

I agree that Android doesn't have the draw that iPhone does, but the most popular phones aren't the fee ones, they're the $200 ones.

To be honest, I couldn't actually tell you why that is. Up until the Verizon iPhone, it was clearly because Apple wasn't releasing on all carriers. But people are still buying the expensive Android phones, and given how crappy the manufacturer overlays are, I couldn't tell you why. My guess: you look at an iPhone screen and see the same boring grid of icons. You look at an HTC phone and see that super fancy weather/clock widget. As crazy as it sounds, that appeals to the typical consumer. Unfortunately they don't know what waits for them once they start using the thing...