No, their biggest problem is having so many countries you can't buy apps in yet. I don't this does more than minor damage to the Android brand.
Companies like Packard Bell and eMachines make nothing but low quality shitty Windows computers for decades and they didn't really damage the Windows brand. Not saying that Windows has a sparkling reputation mind you, but the things that have damaged their brand have been their own fault really. And in the end, everyone still ends up buying a Windows PC because they're everywhere, at every price point and every form factor.
Windows and Android are not the same platform and buying a computer is a difference experience than buying a mobile phone.
Even if I give you that they are the same, The eMachines and Packard Bell still looked and felt the same (from an OS perspective), you could blame the performance on the crappy PC, not the software running on it.
In the Windows 3.0 and 3.1 days, they didn't. Almost all the PC manufacturers used to include extensively customized desktop UI's. And man were they awful.
Edit: Here's a link to screenshots for the custom UI shell that Packard Bell used to ship with Win3.1 and Win95. Prepare for the horror! :-) http://toastytech.com/guis/pbnav35.html
Companies like Packard Bell and eMachines make nothing but low quality shitty Windows computers for decades and they didn't really damage the Windows brand. Not saying that Windows has a sparkling reputation mind you, but the things that have damaged their brand have been their own fault really. And in the end, everyone still ends up buying a Windows PC because they're everywhere, at every price point and every form factor.