And while not directly related, many will argue that Intel's monopoly power is negated by the fact that processors are durable, and so Intel has to "convince" consumers to purchase new ones. While this is true (Intel's monopoly power is attenuated by this fact), that does not prevent Intel from acting strategically to maximize its profits across time. Having no competitors gives them more flexible to do things like disable features on 'K' models, and use sub-optimal TIM.
This is definitely the heart of the matter. While Intel does have a lot of resources at its disposal, they are still finite and hence Intel has to make the best use of them that they can. All three of the previous points regarding Intel being 'complacent' fall into that category - Pentium 4 was a bad marketing idea while a large portion of Intel's resources were distracted with bringing the next big evolution in processing to market. (aka Itanium, which likely would have resulted in us having even better computers now if not for competition which forced Intel to move resources back to projects of immediate concern.) Then Atom wasn't really 'delayed', it was just an attempt to expand Intel's available markets which didn't pan out so well and hence wasn't given more resources to accelerate its schedule. And lastly the current state of desktop is just because the traditional desktop resources are focused on mobile - if Intel had more resources they could make a SKU for high performance desktop (different layout from mobile oriented). All comes down to resources and business strategy.
Anyway, I also tend to be of the opinion that Intel could have a 100% monopoly on all forms of processing and it wouldn't their pricing or rate of innovation much at all. (Hopefully it would affect their stock price, but I'm not convinced it would based on past behavior >.>) Pricing would stay reasonable because otherwise government oversight would step in, then rate of innovation would keep pace in order to keep selling more product. We'd likely actually see more revolutionary advancements is there'd be less need to constantly iterate on the status quo in order to keep ahead of the competition. (Well, that and Intel would almost certainly increase its available resources which also allows for such.)