A good craftsman...
can make anything with even the basest of tools ;)
To be fair, the N8 is pretty impressive and camera phones have come a long way; these days, I'm quite happy to snapshots random things on my Desire HD, tweak the results and punt the image over to Facebook.
But camera-phones are (currently) fundamentally limited by the physical restrictions of their design (no optical zoom, limited flash range, heavy drain on phone battery) and are a relatively expensive - and secondary - feature, so tend to be underspecc'd, in much the same way as PC manufacturers tend to skimp on memory and hard-drive space.
In many ways, the N8 is the exception - but it comes at a significant cost; 9 months after launch, it's still priced over £330 (Carphone have it on PAYG at £429). Meanwhile, my Canon Ixus 200 HS has equal or better specs (24mm lens, 5x optical zoom, 1080p video recording, etc) and started at £199 when it was launched in March; 4 months later, it's now down to £169 on Amazon.
To be fair, the day someone figures out how to cram optical zoom onto the back on a mobile phone, the pocket-compact camera days will be officially numbered. But we're a long way off that yet...