What I find confusing is why the API would be acceptable on an iPad and not on an iPhone. It seems unlikely that Apple would be willing to devote the resources

What I find confusing is why the API would be acceptable on an iPad and not on an iPhone. It seems unlikely that Apple would be willing to devote the resources to testing the element on one and not the other, or that the software behind the two implementations is different enough that testing would not carry between the two. And, if that were the case, surely it would have been easier to just not release the API at all? Rather, it sounds like someone at Apple decided that popover widgets provide a poor user experience in small form factors unless they are carefully designed, so they disabled the API on the iPhone to discourage careless use. Obviously, the same restriction would not apply to Apple... which is unfair but understandable, given that "We know design better than you" is basically Apple's value proposition.