You're entire analysis is pretty far off base. Where to begin.
Apple doesn't sell iOS either. What Apple charges for OSX upgrades is marginal. With Windows 8 and the upcoming free Windows Blue, Microsoft also realizes that the days of people paying $100+ to upgrade their operating system is over.
The mobile mindset is affecting all areas of personal computing. People more or less expect basic system software to be free or near free. They're willing to open their wallets to purchase content (apps, games, music, video, books, etc.). Or they're willing to view ads in exchange for free content.
Most of the money in hardware sales will fall victim to commoditization, leaving only a few innovative, vertically integrated companies remaining (Apple, Samsung). Google doesn't seem interested in competing with those companies on the hardware side, but they are actively seeking to compete on the software side with Apple.
Google Play, App Store, Windows Store, etc. They're all revenue generating machines, allowing the gatekeepers to take a percentage cut of any content sales. Operating systems are also cash cows on the data mining side, providing details on everything: e-mails, search data, location data, app data, purchase data, etc. It's valuable information for companies whose software thrives on such data, like Google AdWords.
It's a land grab plain and simple. How many decades did Microsoft rule the PC market after Windows established itself as the defacto standard? Google's success at this early stage is solely measured on how many eyeballs they can capture. They're already a very profitable company (and increase their profits quarter after quarter), so I don't see them having trouble monetizing on their commanding share of the mobile OS market.