[plugnburn]

Why doesn't a cheapest Android smartphone with a 3G modem (say Alcatel 4009D) fit?

Because it's not 4G? Well, here's the real tradeoff: security, comfort, cheapness. Pick two.

[narrowrail]

Mostly because I believe the device can be more cheaply made if it does not have to run a full-featured OS such as Android. No browser, no color screen, just like my old Nokia candy bar phone; no GPU at all would be required.