Actually I think they might have seen it as a problem. I genuinely believe they wanted to target the N1 at only developers and sophisticated users who generally self-serve as far as support goes. They wanted to seed the evangelist and developer communities with a top notch, completely open phone so that they would then develop for and recommend Android to their followers.
Had grandma and joe sixpack started using it they might never have been able to handle the support issues. I think they identified a set of users who gave them high "bang for their buck" and specifically targeted them. I know many people say they never saw an ad for the N1 and yet I saw them for a solid 2 months straight on every page that had Google ads on them.
I'm thinking that the only reason Google would have abandoned the Nexus One is if the manufacturers promised to ship upgradeable phones running the latest (unmodified) Android.
