I think people know absolutely fuck all about the future of iOS gaming.
Well, it depends on what we're talking about. Will it ever completely replace dedicated handhelds? That remains to be seen. Right now, it doesn't seem like there's a major stakeholder (i.e. Apple or any smartphone-centric developer) trying to bring a big-event title to the platform. I've never seen an iOS game advertised outside of having a 2 second placement in a montage of different games. I don't ever know when anything is coming out unless I've been uncharacteristically following the title specifically. So, there's nothing out there that even comes close to matching the enthusiasm of something like "new Monster Hunter!" or "new Pokemon!" day.
I'm not really seeing any indications that this is going to change any time soon, either. So, in that light, I do think that there may be some degree of hyperbole by some that thinks that the market is just going to keep accelerating in growth at a rapid clip and become the de facto gaming platform. There's still a lot of money to be made in selling full-priced games to enthusiastic nerds, and that market isn't really catered to on smartphones.
However, I don't think it shows any signs of declining in health either, and I don't know why it would. There's enough decent stuff out there -- even among the crap -- for people to keep buying. And playing games on the device you're already carrying is never going to stop being convenient; there's always going to be a market there. Even if that market never matures into the market that can support blockbuster, AAA titles, it'll still be there.