Nice summary, Morac, excellent points. You are right, the 90 minute DND thing makes no sense if you think about it. Also yes, the level it self is somewhat minor (but honestly should still work), but the implications for all the other aspects of the system and apps that rely on them (games, panorama photo shooting, video stabilization) for accurate readings are quite severe and not what you would expect. In particular it is not acceptable when all the previous devices (at least the ones I checked including iPhone 5, iPhone 4S) are all perfect, proving that this is something it seems like they already know how to do.
The most plausible explanations seem like either 1) something wrong with M7 chip (hardware or firmware), 2) some major manufacturing problem with the placement / factory calibration of the sensors in the 5S, 3) some major flaw in the parts themselves that are used for the sensors in the 5S. I do not believe this has anything to do with iOS 7 since the iPhone 5 and 4S devices that are totally fine also run it. I also do not believe this is an easy software fix since it seems like it is off by inconsistent amounts and also that this made it this far.
Honestly I am baffled that Apple let this through. In terms of a total quality control lapse, this demonstrates a drastically more severe level of carelessness han "antennagate." The ability to get highly accurate gyro/acceleromter sensor data has existed for years with iPhone hardware. Where cellular antenna reception is sublte and affected by an enormous number of constantly-changing conditions, and relatively much more difficult to replicate in isolation, the sensor accuracy is simply a matter of opening the compass, doing the silly calibration thing, and swiping to the right one screen, and then putting it on a flat surface, anywhere in the world, at any time, with no external dependency required (other than gravity) and look at the number to see if it is zero (or color--do you see green). How on earth does this make it through the first basic round of regression testing? How can you ship that?
I'm scheduled for Apple store genius bar in Century City (Los Angeles, CA) on Monday night. Last night, I chatted with AppleCare and the guy insisted that his 5S is correct, that not all of them are affected, and that they should be able to exchange. I'm not sure I beleive that any of them are right tho, b/c I have checked 7 different 5S devices, 4 that are unlocked from the same order, 1 AT&T single order, 1 shipped Verizon single order, and my own (unlocked and from a different order). They are _ALL_ either 3 or 5 degrees off. It should be entertaining if nothing else.
Jamie