The end user doesn't care about openness directly, just as they didn't care about it in the case of Windows vs. Mac or internet vs. AOL. It's the benefits of openness they care about.
In the case of cell phones, the benefits are large and obvious. In the case of mp3 players I can't think of any.
They cared in the case of AOL vs internet, because AOL completely sucked.
Similarly, a growing number care in the case of Windows vs Mac/Linux, because Windows is so awful.
Is the iPhone, or other smartphone for that matter broken enough to cause pain to users?
I don't know, you could be right, but I don't see the problem that gets solved by Android right now for the average user.
Windows didn't take over the market because Mac OS sucked. It won because it allowed scores of OEMs to make all sorts of computers targeted at all sorts of consumers.
That's the same with the iPhone. Believe it or not, a lot of people hate AT&T. Or they have family on Verizon, and get free minutes when talking to them, so they sign up with Verizon. Or Sprint or T-mobile or whoever else. Or they get 15% off from work.
No matter how great the iPhone is, being tethered to AT&T means that >2/3 of customers won't even consider it. What this means is that Android, by being on whichever carriers want it, immediately appeals to at least 2x the number of customers. It could be significantly less good than the iPhone, and it will still sell more.
Then there's the form factors. It might be hard to believe, but most people just want to talk on their phone. Android can be on a cheap-ass clamshell. People with cheap-ass clamshells might still want to check the weather, play simple games, etc, so there will still be a market for apps there.
A lot of people use their mobile for business. They care about call quality, battery life, and a keypad, all things the iPhone sucks at. Those people will, on whichever carrier their company has a deal with, have Android phones available to them that fit that needs. (No idea if any will make inroads on Blackberry though.)
The iPhone has Apple/AT&T's marketing budget. Android has Google, a bunch of OEMs, and a bunch of carriers.
In the case of cell phones, the benefits are large and obvious. In the case of mp3 players I can't think of any.