Those hundreds of people are probably all doing what Steve Jobs tells them to do. I have a little faith though that it will probably be the right thing.
Perhaps there will be more of a focus on web apps, all your data in the cloud etc. I do have the feeling that this might have been the original intention (remember the original idea, as stated at least, was for third party apps to be web apps only). Perhaps
SproutCore and the like just came a little too late. That's software rather than hardware speculation of course, and obviously doesn't address your 3rd gen iPhone question. Maybe no hardware 'wow', just evolution?