Yes consumers have no idea what any of this means. But that actually works in favor of Apple's competitors. When an average consumer looks at the smartphone market, Apple may stand out, but the iPhone is still just one among hundreds of smartphones. There is tons of competition on features and price.
Finally, Google doesn't need to kick it up a notch. Android is doing extremely well. Keep in mind that Google doesn't need Android to make money. Google doesn't care if Nexus One sales are sluggish. They are in the market to change the game. And I'd say they are succeeding with that.