What?!? Going by this that means Apple must ship fake iBuds with all their iPods and iPhones! Because they all sound like crap! Dull, flat sound. And the fact that iPods and iPhones output relatively low quality sound from their headphone jacks to begin with doesnt help matters.
Sorry - BS IMO. I have the IP4 and it has a very clean DAC and actually sounds great out of the HP out (B2 IEMs and modded MS1is). I have portable amps - but quite a lot of the time I either use the HP out on my iPod Touch G4 or IP4. Yes I do use the line-out when I want to get a clean signal to my E11 or PortaTube - but crap out of the HP out ...... yeah right
Second - yes the iBuds have terrible bass - but try listening to them in a quiet environment. The mids and treble are actually not bad. They get a bad rap - and yes I'd rather use my IEMs or cans - but in a pinch, the buds are OK. They are miles better than the generic crap buds you can buy for a couple of bucks that seem to be flooding the market aimed at teenagers. Also - try using the buds and pressing them enough to create a seal. Then you get bass as well. It hurts like heck after a few seconds - but you'll get a better idea of what these little things are capable of.
Honestly - reading your post read like a typical hipster 'cool to hate Apple'. Sorry - that's the way it seemed to me. I agree with Kiteki (and I don't usually agree with him that often ). They're nowhere near the peak of audio greatness - but IMO they are not crap, and neither is the HP out on the latest iPods / iPhones.