So in other words they give you both the option to retain current performance and the option to upgrade and reduce performance but have better app compatibility, and that's somehow a bad thing?
Software updates don't have the ability to give your device more RAM or a better processor, and the original iPhones were extremely underpowered. I don't know exactly what you would like for them to do.
Let me guess, you probably had an original iPhone and suffered when iOS 3.0 came out and performance was terrible, right? Did you know that a subsequent release (3.01 I think) fixed this issue and performance was fine again?
The one thing that I will acknowledge is that newer devices with more memory and more CPU power tend to go to app developers heads and they start to write apps that run beautifully on new iOS hardware, but slowly on old hardware. That is hardly an Apple problem - you'd be hard pressed to find a 3 year old PC that can run the latest high end games as well as a brand new one.
I personally find it amazing that my original iPad purchased 2 years and 3 months ago will still run the latest software just fine. My wife's iPhone 4 purchased 2 years ago also works just fine, and she didn't want to ugprade to the 4S because everything still "just works" for her.
At half the speed or less compared to when the phone was bought, be driven insane and then be forced to buy a new phone.
Or at least that is how I experienced iOS updates while I was still in the iPhone camp.