Re: Seems to me that short term memory is at fault.
They might very well be incompetent in this case. However, instead of stupidity, let's consider "forethought".
It's been mentioned that one of the conditions is that the iCloud password NOT be reset for Apple to be able to help. Suddenly we have a phone in a well-publicized case that had it's iCloud password reset. No real answers but fingers pointed at different people... the FBI, the County office where he worked, and the local cops have all had the finger pointed at them for resetting the password. This is perfect case (due to publicity and well... terrorism) for them to push the envelope.
I'm guessing they know full well that there's nothing of value on that phone and that this is a test case to see how far they can push the envelope.