I (respectfully) disagree with just about every single thing you just said.

I don't. In his last paragraph Rob R. said it did occure to him that hardware design might have been dictated by needs of superior software.

I think that Hugo, after experience with his MP3mobile had quite clear picture of the features really user-friendly SW will have to have and usage patterns it would make possible (BTW, I don't believe we have seen all those features as yet). Some HW details became obvious then - like a need for a high-contrast graphical display. Some others were clear beforehand - like use of laptop as opposed to desktop disk drives. There must have been design decisions based on engineering and financial tradeoffs - like DIN-sized dash-mounted unit vs. remotely mounted one with a separate control panel, tuner placing and design, absence of power amplifier. Finally, opennes of the player (and its resulting geek appeal) did not come by accident, I suppose.