[MBCook]

> I think — and frankly, the document isn't too clear on it; it'd be great if an iPhone owner could clarify — is that this is the Apple App Store account password, and the phone has a separate and different passcode. The FBI knows the password, and can access the account, but not the phone; the phone I'm guessing won't back up until the passcode is given to it.

I believe you've basically got it. The iCloud password was changed (different from iTunes account), and the phone doesn't know the new password. That means the phone can't backup to iCloud. The solution is to unlock the phone and iOS would prompt you pretty fast for the new password, or you could go straight to settings.

So they need the pin to get in and update the password so they can get the data from iCloud or the pin to get straight in. They're stuck and NEED the pin (short of getting the CIA/NSA or someone to go hardcore and start capping chips or something else more extreme).

The 'erase data after 10 attempts' thing is an OPTION. There is a chance that's not on. The increasing delays when you get the code wrong would probably still make brute-forcing impractical.