...it's not $99 for a replacement battery
Except when the only thing I'd wind up using the service for over the course of 5 years (as if that were even an option with Apple) would be for a battery replacement. I've never had a screen crack, and the one time I've had a phone develop a dead pixel line after 3 years of use (Samsung Infuse 4g) I had my upgrade to use anyway; I've never had a phone just stop working; I've never dropped my phone in a puddle, let alone a toilet; and I've never had to call customer service to troubleshoot a phone. I have, however, had to get a new battery for a phone about every year to year and a half. More often than not a battery replacement came not because of any difference in how long it kept a charge, but in performing my normal monthly inspection of the battery (which can't be done on a sealed battery) visible swelling had occurred.
Now in getting a battery replaced, I'd be plopping $20-50 on a replacement battery either online or at RadioShack or BatteriesPlus, having it within a few days if not immediately, and then inserting it in my phone and plugging it up overnight. I'd be without a phone only as long as overnight; which is fine because I do not accept calls after 9pm as a rule, anyway. Compare that with what would happen with AppleCare: I'd have to take a day off from work to drive the phone to Atlanta during Apple Store business hours(nearest Apple Store location, about 2 hours drive time). Have the Condescending Hipster behind the counter inspect the device to make sure that it hasn't been exposed to too much humidity (welcome to Georgia) and thus valid for the replacement battery (as opposed to charging me the deductible for a replacement phone in the event that I let the phone sweat too much), having him keep the phone for him to send it out to get the battery replaced (about a week) after which I'd have to make another drive up to Atlanta to pick it up. In the mean time, if I didn't have a spare phone to use, I'd be SOL for getting calls in that time, because of course they don't offer loaners. So actually you're right; not only is it essentially $99 for the battery, but it's also the opportunity cost of 2 days off from work, half a tank of gas, 8 hours worth of travel time, and a week without a phone; just for a stinking battery.