All i was told was that "live" browsing was never contemplated, and offline was considered doubtfull and so abandoned.
Continued use of wireless consumes a lot of power, Eink isn't fast enough for any kind of animation, the browser on Iliad would require a lot of work to remove the various elements not to be usead (flash mainly) and to paginate the content correctly on screen.
It wasn't planned but that doesn't mean it won't be added in the future
