Apple still does not own its own fabrication capabilities. I assume you mean design capabilities.
It's anyway a big claim that Apple was always somehow competing with everyone in the market. That's the company which rebranded HP Laser Printers, made an HP-branded iPod, made an iTunes phone with Motorola, just moved from IBM PowerPC to Intel for their PCs (!), decided for a while to not make a 5K display but let LG build an official one instead, pushed LaCie as an external HDD partner, etc.
Apple always had ambitions to "wow" with its customized thoughtful products, but before the "iPhone money" they barely ever had enough order-volume to dominate a supplier...
I'm not sure that was a foregone conclusion back in 2005-2007. If anything Apple was forced to design their own chips because nobody else was able to offer what they wanted. M-series is a thing because Intel couldn't build the low-power/higher-performance CPUs that Apple wanted.
Intel is a big reason things are so great, but also so crap, in computing.
Try to remember, the computing revolution didn't start in the 21st century. It's just got incredibly insane, in the 30 years of personal computing.
>Why wasn't Intel interested to supply the CPU for the iPod?
Because Intel and Apple had beef, long-since, already. The iPod was just another mp3 device, until - suddenly - it wasn't.
The writing on the wall for personal computing has been there for all of the computing pioneer companies .. the fact that Intel and Apple didn't get connected, is as much about the fact that these people were really in competition with each other from the beginning.
Apple was always going to own its own fabrication capabilities. From the outside of the box, all the way in.
Intel wanted all the other boxes, not just Apples, too ..