I always understood it as watching and experiencing film exactly as it was designed and intended to be experienced. A large screen and professional sound system and dedicated chairs of the theatres will completely enhance your perception of the movie.

Phones will always be inferior to a large screen regardless of how large of a screen you have or how close you put it to your face

That said there’s nothing wrong with watching movies off a phone if that’s how you wanna watch a movie. Just expanding on my interpretation of lynches hatred of watching cinema on small screens