Look at the sales numbers on the Galaxy S2 and tell me resolution matters. For that matter, look at the sales numbers on the Galaxy Nexus and tell me a mediocre camera matters. The key is mindshare with the people that SELL the phones. Elop is spot on.
Let's put it into perspective:
Galaxy S II
Announced 2011, February
Status Available. Released 2011, April
On AT&T (US Carriers always lag in availability of Samsung devices)
Announced 2011, August
Status Available. Released 2011, October
Yes, WVGA was still common - even on newer devices in April 2011.
Lumia 900
Announced 2012, January
Status Available. Released 2012, April
So 1 year after GS2 launch, and 6 months after it came to AT&T Nokia wants to compete with:
1. Old QC processor vs. the Exynos in the AT&T GS2
2. A Worse Camera, and it only does 720p video instead of 1080p (IIRC, Correct me if I'm Wrong)
3. A. 1.3 MP VGA FFC
4. Barely a better screen, if better at all - Lower PPI due to screen size difference
5. BT 2.1 vs 3.0+HS
6. No WiFi Direct
7. No NFC
8. 512 MB vs. 1GB RAM
9. No SD Card Slot
10. [Subjective] WP7 instead of Android, when Ecosystems matter more now than ever
The GSII is being eclipsed by the GS3 and you can't even buy it in AT&T corporate stores anymore (only the Skyrocket), but the Lumia is still there going strong with specs from 2 years ago.
The only spec that the Lumia 900 bests is the fact that it has LTE (if we're disregarding the Skyrocket), 0.2" bigger screen (if we're disregarding the Skyrocket), and the fact that it's a WP7 device (which is entirely subjective). Oh, and it has a bigger battery (Again, if disregarding the Skyrocket).
There is significant spec lag in the WP7 device ecosystem compared to Android and iOS.
App issue has been discussed ad nauseum. There will always be those people who seriously think the browser is all they need. The Playbook fans on crackberry thought the same thing, and that didn't turn that device into a success.