Canon has a problem. I know you do not believe that, but they do. It's a perceptual problem, and it could seriously affect their revenues and ability to fund the necessary R&D in the years to come. Such things have happened before, and often companies, even if they were on the top of the world, NEVER recover (Kodak?) So...seriously...touch screens and touch UIs?
Canon has a perceptual problem? That depends on who is doing the perceiving. If you're referring to CR Forums and similar places, perhaps. Perceived 'poor sensor IQ' is an Internet forum problem Canon has had for years. Hasn't affected their market share, though.
As dtaylor stated, the analogy to Kodak is a red herring.
Seriously, touch screens and touch UIs. Entry level cameras have them. Canon wants people to upgrade, and people don't like to give up features to which they're accustomed. Omitting basic features which a majority of their customer base expects to be included (a category into which touch screens fall, but low ISO DR does not) would certainly 'seriously affect their revenues and ability to fund the necessary R&D in the years to come'.
I think you hit the nail on the head. Personally, I am not real fond of touch screens. Even so, I use an iPhone, not a Blackberry; I have a Nexus 7, I recently acquired a Surface Pro 3 and use it as a tablet more than I use the keyboard attachment. A good friend just got a 70D and I helped him set it up. Ended up using the touchscreen half the time setting it up. IF the 7DII, by whatever name, is in my price range it won't matter whether it has a touchscreen or not as far as I am concerned. I probably won't use it much if it has it and I won't miss it much if it doesn't. I don't shoot video much and since I have it on my G12 and my 7D I don't really care if the 7DII has it or not....but it makes a big difference for some people. Having features I don't have to use doesn't bother me as long as I get improved IQ, improved DR would be nice, and improved AF would be necessary for me to spend my money.