It wasn't a mistake -- "consumers don't know what they really want, so we'll only sell the version they
should want" was straightforward Jobsian thinking.
It's similar another famous case of a perfectionist founder rejecting customers' demands, Henry Ford's famous statement about the Model T that "any customer can have a car painted any color that he wants, so long as it is black." (http://www.gutenberg.org/cache/epub/7213/pg7213.html#id00226)