According to Ventura Beat, an Android team member says that Apple asked Google not to use multitouch in the G1, or else. Obviously, they complied. Their alleged source said that Google had plenty of reasons:
First, their source claims the company didn't want to angry the Steve-O. Even while the G1 hardware supports multitouch, the possibility of clashing with Apple-who is an strategic partner with the iPhone-was not convenient for the interests of the company. At least for now.
In addition to that, Ventura Beat's source says that the legal battle would have been too much and Apple has the upper hand with a billion kajillion patents on the whole multi-touch thingamajig.
Completely drunk sources also claim that Google's CEO Eric Schmidt likes Steve's tempura tofu too much to risk his gourmet pleasure over a stupid phone. And when I say "his gourmet pleasure," I really mean "his gonads." [Ventura Beat]