As regards the battery, yes the iPhone one sucks - most phones with a full-sized touchscreen tend to suffer from that. But as has been said before, why couldn't they keep the same thickness as the 3G and potentially double the battery life?
Because you are buying into the Apple lifestyle, style and looks are paramount for Apple designers.
Having a larger battery would be less 'futuristic' and 'cutting edge' looking so they compromise, make it thinner with a lower capacity battery to give the impression it is technologically superior in all ways to the previous one and bingo...sales carry on at the top of the charts with the new 'improved' 'latest technology' iPhone
I do have a full sized touch screen phone, battery lasts 5 days and it uses Symbian OS...do I really care if it's 1/2 cm thicker than an iPhone? Nope and it's been around longer than iPhone anyway and worked forever in gruelling conditions like an AK47 lol