For some weird reason people believe Apple is able to create things that don't yet exist.
They believe a thinner design is possible. Yet it isn't even remotely possible because the CONSUMER demands a higher megapixel camera. Of course they will then say "BUT you can taper it!". NO, they can't. The BATTERY life you demand is not possible since the battery has to be of a specific size to get the current time ratings.
They believe a bigger screen is possible. Again this isn't possible because Apple has a made a choice. They choose to standardize the iPhone on a 480x320 screen. Their only solution to keep this programming standard was to double the screen size and let the software scale based on the hardware in use. Hence they now have a 960x640 screen. When they did that 3.5" WERE the largest screens out there. This allowed them to coin a term called RETINA Display. By Apple's definition, they have said any screen 300 PPI (Pixel Per Inch) or denser, the iPhone 4 is 326 PPI, is a Retina Display. This standard was lauded by the tech community as blessing for clarity and color reproduction. So for Apple, to maintain their own standard for the screen, can only be enlarged under its current design to 3.8". There would be NO COST BENEFIT for them to do that.
BTW, Android decided not to stick with one resolution for their phones. They now have 7 screen sizes. And their users and developers are no complaining that this lack of a single resolution is now hurting application development and a consistent user interface.
Do you want to know the real reason people are complaining? Ignorance. The average consumer doesn't have a CLUE what they are talking about, much less what is even physically possible.