because you're not trying to understand what makes apple products superior in the eyes of apple users, it's simply "ease of use," no one is saying this thing has a 7mp camera, 30gigs of memory, etc..
if you want the positives of ease of use i will explain.
viewing photos:
+simply drag to what you want and zoom in/out
web browser:
+you can view the whole website, in landscape or portrait
+you can zoom in on a specific part, i.e. the upper left part of the site, the bottom, the dialog box, wherever you want
+has a "expose" like feature that lets you easily navigate between multiple websites
phone:
+visual voice mail
+fast user address book
ipod:
+landscape or portrait mode
+full album cover view
+can adjust volume for ipod and regular phone on its own
sms/email:
+organization based on contacts, similar to ichat
+email displays how it would look on a computer, allowing you to view documents, graphs, etc.
phone overall:
+no slowdowns or lag
+will adjust screen based on circumstance (move to portrait, landscape; ambient light sensor)
+never physically "x" out of a application, thus what you want is always running, and still no lag or slow downs
+multi touch allowing for some of the features i just mentioned
+ease of use demonstrated by having one simple button
+6-7 hour real life testing battery life
+IMO best touchscreen keyboard out there on smart phone
those are some of the things i could come up with on the fly, without thinking and not owning the device, yet playing with it for maybe 15 minutes. Is it the best thing ever? no, of course not, it has alot of short comings, but it also has implemented some new features that other smart phones simply did not have basing their UI on the multi-touch screen. No other phone company such as Motorolla, samsung, etc. has done anything intuitive in terms of user interface as much as apple has, it revamped the way a touchscreen phone should work. Is it missing alot of things it should have? Of course it is, this is apple's first phone and ask any true apple fan, they will tell you never to buy first gen products! What in my opinion makes this phone so great? Aside from its shortcomings which imo are more of a apple never creating a phone, it set the bar in terms of how a smart phone should work.
is it worth $600?
in my eyes, on a theoretical sense YES IT IS! All these smart phones are just as expensive, however, they appear not to be due to subsidized cost, which the iphone isn't. Would i ever pay $600 for one? nope...
You also have to understand apple marketing/pricing...
Apple doesn't have multiple products being released as other makers. Such as Motorolla, who can put out the RAZR at let's say $200, than create the KRZR for $200 dropping the RAZR's price to $150! Apple doesn't do this, they create one product and stick with it... thus what you have is the same scenario as the ipod, creating one product at an outstanding high price, allowing you to lower prices for the next 5 years where it would still be beneficial for apple.
They cannot introduce the iphone at $200 today, and expect iphone rev.3 in 2009 to stay at the price it was introduced at, consumers are used to prices going down, introducing the iphone at a $600 price point, allows them to do so...
hope that helps.