I mean, it's not like 500 million people are using a high-quality device like Galaxy S3.
Some of those crappy Asian handset makers make very good phones - the Chinese Android phones from ZTE, Meizu and Huawei are competitive with mid range phones from HTC, Samsung etc. Some are even in the same class as the S3 - eg, look at the benchmarks in the Meizu MX-4 review[1] (unfortunate iOS-like skin notwithstanding).
Even the low end phones give people who never had a computing device access to communications and the internet. How you claim that isn't meaningful?
[1]http://www.engadget.com/2012/08/01/meizu-mx-4-core-review/
Sure, they don't have the latest greatest shiny, but so what? Its still market penetration, and unlike people just chasing shiny toys, they're looking for tools. And that's what they now have, a powerful tool that almost entirely everything the s3 does.
It doesn't have the most powerful graphics, and that userbase might mean targeting a lower API level. Thats about it.
I really don't see where you're going with that statement.
I thought my statement was pretty simple. If there are two operating systems, and one is sold exclusively with a high-quality device, and the other is sold very cheaply with shitty phones, then when the latter's manufacturer says "we have 500 million devices running our OS" everyone is going to go "well, duh!"
The mobile internet is well developed and affordable to even common man in most of the Asian countries.
And for a service like Google+, the it makes sense to have more people on the network.