Speaking of UI prototyping, have a look at how the folks at Omni approached designing for the iPad without having laid hands on one. Not only did they make great use of paper prototypes, they created a non-functional mockup of an iPad to help get a feel for the interaction on a physical device. This reminds me of Jeff Hawkins, founder of Palm, carrying around a crude wooden prototype of the original Palm Pilot as part of his design research into that product.
UI prototypes help explore, share, and validate a design. Going the extra mile to create a simulation of the device on which a software product will be used undoubtedly contributes to a successful design.