I agree with you. Of course, an iPhone can surf the web, make calls, take pictures, run the calculator, etc. However, lack of means to install apps without the App Store (besides sideloading), can render any phone pretty much useless.

Android has problems of its own though. Yes, you could install apps easily without access to the Play Store. But most Android apps rely upon Google's Play Services one way or another, so those apps wouldn't work properly, if at all.