> Of course I don’t know the full backstory, but it sure seemed like the original plan for 3rd party developers on iOS was to have us all just build apps using the web.
Correct, there was no SDK on the first generation iPhone. It was a closed device, like all Apple devices. And that's how Jobs wanted it, he just thought that the idea of third party applications running on this device was pure absurdity.
Then Android came out and Jobs had to adapt.
> Apple made what turned out to be a really smart business decision: they released an iOS SDK and an App Store and the rest is history.
Kind of. Apple made a really smart business decision: they realized that if they didn't match Android and provide an SDK as well, they would lose. So they followed suit.
> The end result, for those of us still trying to build installable web apps for iOS was that with nearly every new iOS release some key feature that we were depending on broke.
This makes it sound as if these features got accidentally broken. No, they were intentionally removed or crippled because they either threatened Apple's dominance or cut into their profits. You could call that another set of "really smart business decisions"