Ok here is my take on this whole situation. Apple and the tech companies are in the wrong here, and not for the reason you may think. Because even if they win this case, since it is now approching the supreme court, they will probably end up loosing badly on may different levels. (As of now one judge in California supported the FBI and one in New York supported Apple, why there is two cases about this matter don't ask me.) And the FBI is doing it job, and doing what is in the best interest of Apple, by asking apple to do this. (NOTE: I will go through what I think Apple should do with this case to make it the best for all involved, at the end of this novella type post.)
It isn't whether or not all of what the FBI want is possible because it is. A lot of these items where/are a part of script kiddies tool kits though not in any robust form they want. And their are people standing in line to take a crack at it like Avery, the creator of the Avery Security suites. So even if the FBI "looses" this battle they can go these people and Apple and its supporters worst nightmare of what happens to this "master key" will more than likely occur. Heck the FBI can be total dicks and do its as an open source competition. (Not that they will since it would put the FBI in more of a bad light then they already are.)
The other way they will loose is by perception. One of the FBI's witnesses put it rather well. When the laws where made for warrants there was no concept of a place that couldn't be opened or accessed with out destroying the items they warrant. But now there is, and Apple and its supporter stance can be viewed as whether or not these spaces where law enforcement cannot go in and do their job, when they go through the proper legal steps.
What Apple and its supports should do is compromise. And in the past few years it seems this has become one of the longest "four letter words" out there. The best middle ground they can strive for here, is saying Ok will make the tool, but this is what we would like the government to do:
One: The tool will be in control of the tech company, it will not leave the company's premise the phone will have to come. There will be a special department we will set up that will have oversite over the tool(s).
Two: All requests and warrents need to be varrified by that department, before the phone is open.
Three: Part of the department's needed revenue will be provided by the US government since it's exhist for the sake of law inforcment, and placing all the financing on the companies will be an undue burden.
