The antenna, once more
Here is my analysis. If there are any gaps in my reasoning, I'd love to know, honestly.
Fixing the broken antenna design is hugely expensive, so Apple is forced to push on with this defective product using as much spin as they can muster.
A new antenna design amounts to a new phone. It takes years and billions of dollars to come up with a new phone design. You should realize that this is only the second phone from Apple (not counting software and other minor cosmetic changes) and number three is most likely still at an early stage.
To make matters worse, this happens exactly when the smart phone market is exploding. Apple badly needs a new product to push to the market at this point. Recalling the iPhone 4 now may well kill Apple.
The next few weeks will be very interesting. Will Apple's brand and strong halo effect be enough to save them this time?