Looking at only candybar phones is pretty disingenuous. Plenty of smartphones before the iPhone were almost all screen, e.g. the Sony Ericsson P800 that Steve Jobs was said to have used https://cdn2.gsmarena.com/vv/pics/sonyericsson/snp800_00.jpg
The Nikon CoolPix S80 line of cameras were full-panel displays. That was probably the first full-panel device.
This turned out to be less than useful. It's hard to hold the thing stable when taking a picture without touching the touch screen.
http://www.techpavan.com/wp-content/uploads/mobile-phone-mar...
Devoting the majority of the vertical dimension of the profile of the phone to display was definitely not a priority of the market at the time.