I heartily agree with you that GPL (v3!!!!) would have been much better for customers and handset manufacturer alike.
Unfortunately, I think that if Google had GPL'ed Android, it wouldn't have had the success it had, because handsets manufacturer and especially carriers would not have embraced it so broadly.
On the Google side, the company is of course interested in the profits, not directly freedom or "progress". Their bottom line is: on the iPhones, they have to share search revenues with Apple, on Android they don't. Google has has already claimed (can't find the link now, but I could dig) that the cost of developing and maintaining Android has already been paid by the much higher revenue they get from searches (compared with what they would have get from iPhones).