Your comparison doesn’t work, I think.
The Swiss Army Knife started out as a multi-use item, intended to perform multiple tasks. Most of those tasks aren’t performed as well as a uni-task object and many of them suffer greatly because of the compromises inherent in the form factor (ever actually use the corkscrew?). The only one that works as well as it possibly could is the knife itself, IMO, and this is not degraded by the presence of the other functionalities. (Some might say the knife could work better if it locked or was capable of one-handed opening.)
The iPod started out as an audio player, then became other things over time that degraded the initial purpose of the device. Two places where that degradation can be seen are in battery life and controls. As soon as the music player is used for something else, the battery life starts to shorten for music playing, a distinct loss of functionality. The controls on an iPod Touch are inferior to the controls on a mechanical iPod, for the purpose of music playing. They work very well for sending texts and playing games, but are more prone to situational failure when the device is in bright sunlight or high humidity, problems not seen with a click wheel iPod.
