How would Larry Paige or Drew Houston have done research to conclude that they are "better/luckier than everyone else who's approached this"? After all, Google was one of the last search engines to enter the industry.

I am not even convinced that that is true. As I said in the last post, given a certain number of people that can solve a problem, what are the chances that they are working on the same problem as Larry or Drew? Furthermore, the amount of time that it takes to prove that an idea is actually a good one is a few years at the least. Next, the range of ideas is so large, that this group of people is going to be heavily segmented in different areas. Lastly, as I pointed out with Dropbox, innovation doesn't always lie entirely in the difficulty of the problem, but also the execution. All of these factors go to increase the minimal size of smart people who can be the first to innovate in their fields.