Except that it would not happen. In a word without trademark protection, people would be like "what the heck is an iPhone, what does it do?" because the word iPhone would have no meaning. You would have to sell based on capabilities, rather than brand name. There would have to be sufficiently strong laws against false advertising and deceptive marketing, but I can see number of advantages over the current system.
I agree with the rest of your post. The whole case is increasingly looking like a successful publicity stunt by the two companies to me. I don't think I would know anything about Bad Spaniels otherwise, and while Jack Daniels is well known, the way addiction works I would not be surprised if a large number of people were hitting their local liqueur store after seeing this case on the news.