A lot of people ask how Apple didn't pick this up in field testing. I think the answer is that they wrapped the iPhone 4 in plastic to camouflage it as an iPhone 3GS (as we know from the Gizmodo phone). Hence all their field testing was effectively done with bumpers on.
They knew... Steve Jobs: "The iPhone 4 went through all of these tests. We KNEW that if you held it in a certain way, the bars would go down."
What killed them was the way the reception bars dramatically plunged toward zero within seconds of bridging the antennas. If the iPhone 4 had shipped with the bar distribution formula in 4.0.1 and used the same level of hysteresis as other phones, no one would have noticed the drop and everyone would have happily gone on using their iPhone 4's oblivious to the attenuation.