As someone who worked on the iPad v1, I can tell you, it was a product built in search of a problem. It was going to compete against the, then, growing Netbook market. Steve Jobs thought Windows was going to win that market and hastily threw a team together to answer for it. However, during several all-hands, no one except SJ seemed even remotely excited about the product.
"These things will probably sell in the educational market or something."
"Developers will always surprise us, they will come up with use cases for us."
During development Amazon was proving that people wanted E-Book readers. So when it was clear the iPad didn't yet have a coherent story from Apple, iBooks was thrown together at the eleventh hour and then SJ went on the attack against Amazon to push back against the growing Kindle market.
And then Windows 8 happened! People asked Apple (And Tim Cook), will we see touch-screen Macs? And instead Apple trapped itself in a corner by doubling down that the iPad was going to forgo running full macOS because something about people not wanting to touch their laptop screen. So here we are, a product that launched without a vision, and then hamstrung by ego.
It's true that people who love their iPads, LOOOVE their iPads. So it's a nice product. It's definitely well made and I love reading the news on mine. It's a great device to travel with, for sure, yet I agree with Gruber, this thing will never flourish outside of the niche markets its found itself in.