Here's what Engadget's review of the original iPhone had to say about the camera that, as you say, wasn't upgraded for another two years:
"..it's still a lousy sensor by even ultra low-end dedicated camera standards, so we'd recommend this not be used in the field for anything but the occasional candid shot"
Ars Technica compared it semi-favourably to low end camera phones, but:
"..Another glaring omission is the lack of video capabilities in the iPhone's camera: something that many very basic (and much cheaper) handsets can do"
It wasn't terrible, but it wasn't anything special, lacked many features found on much cheaper phones and again wasn't upgraded for two full years. By that time it's camera capabilities were woefully behind even the most basic camera phones. Here's what Macworld said about the 3G:
"For a product as on the cutting edge as the iPhone, its built-in camera is an embarrassment"
IMHO the reason they didn't upgrade the camera on the 3G was that they didn't have to. They were selling as many of them as they could make and being in a class of their own had essentially no competition. As I said, they kept improving this feature in reserve for when they needed it. This isn't really a criticism, I loved my 3G, but this is Apple's modus opperandi.
So you have zero proof or sources that Apple deliberately held back better camera parts in order to sell more iPhones the next year. Such a thing could only possibly have been the case with the iPhone 3G, as all later models have had best-of-breed cameras. Unless you want to tell me that at the time Apple made the original iPhone they could have bought the 3GS camera in volume.
Both the original iPhone reviews you linked to are positive about the iPhone camera’s photo quality compared to other phones. They mention the quality was bad compared to point-and-shoot cameras, but that was the case with all camera phones.
At the time the iPhone was announced, I had just bought a SonyEricsson P990. It was SE’s top-of-the-line product and it cost Euro 700. It had a 2MP camera, just like the iPhone, but the photos it took were terrible compared to those taken on an iPhone.
"..it's still a lousy sensor by even ultra low-end dedicated camera standards, so we'd recommend this not be used in the field for anything but the occasional candid shot"
Ars Technica compared it semi-favourably to low end camera phones, but:
"..Another glaring omission is the lack of video capabilities in the iPhone's camera: something that many very basic (and much cheaper) handsets can do"
It wasn't terrible, but it wasn't anything special, lacked many features found on much cheaper phones and again wasn't upgraded for two full years. By that time it's camera capabilities were woefully behind even the most basic camera phones. Here's what Macworld said about the 3G:
"For a product as on the cutting edge as the iPhone, its built-in camera is an embarrassment"
IMHO the reason they didn't upgrade the camera on the 3G was that they didn't have to. They were selling as many of them as they could make and being in a class of their own had essentially no competition. As I said, they kept improving this feature in reserve for when they needed it. This isn't really a criticism, I loved my 3G, but this is Apple's modus opperandi.
http://www.engadget.com/2007/07/03/iphone-review-part-3-apps...
http://arstechnica.com/apple/2007/07/iphone-review/11/
http://www.macworld.com/article/1134482/iphone3g_review.html...