Yeah, you must not have actually seen the keynote. That image is about just what you say: What would suck to do on a 1" display, specifically pinching. That's the whole point of the rotating crown, it replaces pinch to zoom.
AHA so I was partially right:
http://www.cultofmac.com/296093/apple-confirms-iphone-6-nfc-apple-pay/
It's using NFC tech but it's NOT full NFC compatibility or open access to it by devs.