Two classic Apple obsessions put them in this situation.
Their forever quest for “thinner” gadgets, whether or not they need it.
The total secrecy around unreleased products, even within the company. This gave them no option to run the ad by a test audience which would have given them a HUGE thumbs down before they embarrassed themselves by releasing it to great fanfare.
Did they manage to squeeze a LOT into an unbelievably small device. Yes, they did.