The fact that you're referring to it by its late name, rather than the early ones (WinCE / PocketPC) I think is indicative of your perspective. Early WinCE competed with Palm and (what would have become) Symbian; because of incredibly low-res screens, people were supposed to use stylus pens. There was little research on usability of mobile devices to build on. Devices were terribly underpowered, memory was much more expensive.

Believe me, for the times, a (colorscreen!) PocketPC device was not as terrible as you think, considering overall constraints. This was almost a decade before iOS.