One thing I never understood about Apple was the tendency to make things incredibly sleek and aesthetically pleasing, but so fragile that the average person is almost guaranteed to buy a protective case of some variety to ensure they don't have to spend hundreds of dollars for a replacement phone.
At that point, you aren't creating something for the masses anymore, because the masses are covering up that design to protect their phones. Why not just overengineer a simple but good-looking rugged body for the device that can sustain a few drops and dings?
Case in point, I like my Motorola Droid2. For three years I've had this phone and I've never damaged it beyond the concrete scratching the edges where I drop it....
constantly.
I would suggest a good case and Worth Ave Group for your coverage. They don't warranty the device, it's an entire insurance plan. Costing about $175 for 2 or 3 years, it literally covered everything up to and including "Acts of God" (including natural disasters, kids, theft, etc etc). It's only good for one replacement at the insured value, and you actually can opt for cash in hand rather than a flat out repair or replacement, but this is by far the most robust coverage you can buy for a phone.