When the pixel density is that high though, the text starts to strain your eyes.

For equal sized characters (measured in in/cm), higher resolution should result in more readable font. Perhaps I'm biased because I spend all my time in terminals and browsers, but font scaling seems to work quite well for me.

Apple releases "Retina Display", with ultra-high resolution: "Amazing! So much better than anything else! So crisp! So beautiful!" Someone else releases lower pixel density display for laptop, but far better than what Apple deigns to offer: "Ugh! No! How can you read that? That just gives you eye strain..."

(Exaggerated for emphasis)

Right, but most icons do not exist in a high resolution format yet (as far as I know, I would appreciate if somebody to correct me on this, if I am wrong).

Apple's retina display works because they have graphics that are the same physical size on screen. When I switch from my MacBook Pro display to an external Samsung display, the icon and text both get smaller.

Then use a larger font and get better-looking text at the same size as the competition.