Apparently, Steve Jobs doesn't agree, because he considered AMD but decided that they would not be able to offer the same offer as INtel--mainly due to the fact that AMD's processing lines are much smaller than INtel's (Intel still makes up 85% of current computer sales, despite many people's beliefs). Saying that Apple didn't compare the two processors is ridiculous, seeing as Apple is a huge company, and they're far from being idiots.
You said he considered AMD, but there is nothing saying Jobs actually TALKED to AMD. Besides, when Apple has been working directly with Intel on OSX x86 since OSX was first released, I'd say there was a significant comfort level with Intel's products that did not exist with AMD because of the lack of discussion.
And as much as I like Apple's products, I do take contention with your blanket statement that Apple wouldn't do anything stupid because "they're not idiots". The Mac clone debacle, the Newton, the G3 Cube, John Sculley & Gil Amelio all come to mind as examples where Apple messed up royally.
The lawsuit hasn't even gone to trial yet - Intel just submitted their pretrial brief last week, in which they denied more charges than were made in the initial complaint.