All fair points - just one small thing
Tell me the one competitor that offers a better price/feature ratio than Apple in this case?
I know of tons of cheaper (and much worse) competitors, just as I know of some (better?) but more expensive products.
I believe that aside from the huge advantage of Apple's App universe the price is exactly the reason these guys see to be winning this game right now. Both Xoom and the Galaxy are way more expensive.
However, if the competition manages to get subsidized ("free") tablets into the channels, then you may have a point...