The first version of 68K emulation they shipped was not great. At least one third party (Connectix) sold a faster version that replaced the OS provided routines with their own.
In defense of the original emulation strategy it shipped on time, fit in the ROM, and worked reliably with good compatibility. The first round of PowerPC Macs were so much faster than the 68k Macs than even emulated apps worked better. I don't remember the history any more but Apple did eventually do a new emulator, while Connectix made some other emulation products (PlayStation, PC) and eventually sold to Microsoft. I've read that Connectix people helped seed Microsoft's virtualization efforts.
I think that highlights the different incentives for an OS vendor and a third-party: Apple needed to be compatible but they didn’t want to be in that business long-term and focused more on getting developers to port their apps. Connectix arrived a year later and they had to deliver speed since nobody would buy it unless they did.
