First off, no Android device sold blocks installing custom home screens from the market. In the US at least, all major carriers but AT&T allow side-loading applications. What you do see across the board is restricting root access, which, while unfortunate, still allows for a lot of customization.

Secondly, different users will always have different preferences and use cases; the variety enabled by customization allows for more users to be happier. Furthermore, such openness has produced custom apps that blow away everything else away. Swype, a custom keyboard that cannot be distributed to the end-user of rival mobile OS's, is the most obvious example. At least at the OS level, this modularity is a sign that Android is well-designed.