"If I get an iPhone, I know which one to buy (iPhone 4), and I know it will all work out of the box".
"If I buy an Android phone, I have to compare between about a bazillion models, and I don't know whether each has a separate app store, and if I get the 'wrong' Android phone I'll regret it".
Basically, there's /too much/ choice in the Android market.
It sounds like your thinking has been seeded with plenty of Android FUD. The differences between models are not as substantial as that.
(If you're talking about fragmentation from the developer's point of view, don't forget that the iOS ecosystem is not immune to it either. Some iOS devices have an advanced GPU with shader support, others don't. Some devices have a camera and microphone, others don't. Many iPod touches have not been upgraded beyond the original OS release that they shipped with, because the newer version costs $20. And so on...)