Great parallel drawn between the iPhone and appliances — it really is the microwave of the smartphone world.
What people always miss when making the "open" argument with regard to the iPhone is this: What functionality is "missing"?
There are a billion things that the iPhone can't do, and much of this "missing" functionality would be achievable if iOS was open source (and is achievable if you jailbreak). But Apple builds products for the mass market, and all of this amazing functionality the iPhone is "missing" is functionality the mass market can live with or without.
As new apps bring cool new functionality, great. As new features come along in future versions of iOS, even better. If some cool stuff is left out though, so be it. 90% of iPhone owners probably won't know or care.
Personally, I do know and I do care, so I use an Android phone.