First you say "Apple would still have released the iphone" and then "...they [patents] do allow entrenched interests protect their market from upstarts." You seem to be contradicting yourself.

When Apple released the iPhone, they were the upstart in the mobile phone segment. The patents are what allowed/allows Apple to protect themselves from the 'entrenched interests' of the market. That is what good the patents provide.

Not at all, by upstart i mean small companies without massive legal departments and lobbying dollars.