You're right, most end users don't hack Android. Or their computer, or their car, or their washing machine, or anything.
But, these people can pay others to do so. Anyone can make their own Android-based device, just like anyone can fix your computer or your car or your washing machine.
Compare this to the competition, like iPhone OS, Windows Mobile, and Blackberry. You simply can't sell a device with one of those OSes without permission from the vendor. And the vendor is not going to give you permission, except maybe Microsoft for Windows.
That's the power of Android - anyone can improve it and profit from their improvements, without permission from anyone else.
It is my understanding that very few of those devices are developer devices, where the user is allowed to install their own OS. Otherwise you have to root the phone, which is a violation of the increasingly international DMCA-style anti-circumvention law.
I haven't checked this info in a little while though, if most Android devices are sold with root I'm very happy to be corrected.
Rooting your phone is not a DMCA violation. sudo simply is not pre-installed, it's an app you have to add yourself, just like anything else. Reverse engineering for interoperability is a DMCA exception, and there are plans to make the language in the law specifically refer to "jailbreaking" phones.
Also, at least with Android devices I've worked with, there is no trickery involved to flash a new firmware. You just do it.
