Jeff Atwood writes about a common complaint software developers have with iOS, that we are at the mercy of Apple when it comes to reaching potential customers who use their hardware.
This isn't a new complaint (though Atwood explains it well), and it continues to be a valid one. If you want to create apps for iOS devices be prepared to jump through hoops and have your niche yanked away when Apple decides they can do it better.
I'm personally not rushing out to make iOS apps for this very reason, but what keeps me interested in iOS is the fact that Apple has the best mobile browser right now.
It isn't even close how much better mobile Safari is compared to the Android webkit browser. Only with the release of the Honeycomb OS do Android devices even support SVG. If you want to take advantage of the latest browser technologies, you target mobile Safari first.
Apple may have a locked down app store, but they're also leading the pack in providing an environment to making a great mobile web app.
So while Apple may have a walled garden on iOS, they also provide a completely open sandbox as a viable alternative.