I'd certainly not want a phone that looks like it's made by Fisher-Price. The best looking Android phone I had so far was probably the Nexus S with its clean and curved front. But I have to agree: There probably hasn't been a truly beautiful Android phone so far :-(
You keep mentioning that the iPad Mini is almost an 8"-Tablet, but a difference in display area of 49% certainly doesn't come only from a 12% larger display diagonal. You adressed the softkeys on the Nexus 7, but the bigger issue is the display aspect ratio.
That's the (only) point where Apple is spot on: People use tablets mostly for browsing the web. Android tablets almost universally have 15:9 or 16:10 displays. That might be perfect for movies and games, but it's not optimal for browsing or editing documents.