[metalruler]

You could also argue that designing for the average phone may be holding others back.

My Nokia N900 has a screen 800px wide, supports CSS, can display inline images, execute flash, execute javascript. Yet a lot of the time I get redirected to the "m." version of a site, with bland default-font single-color text, perhaps an image or two thrown in if I'm lucky. I would guess the majority of the sites have just copy/pasted a list of mobile user-agents and use that to decide when to redirect to the mobile version. It's a pity that there's no simple way for the phone itself to tell the site what it is capable of rendering.