The verdict? Schiller says the process is in place for a reason. About 90% of the apps submitted merely have bugs or technical issues, and he says for the most part that devs are happy to get that feedback (though TechCrunch doesn't buy that for one second). But the other 10% of the apps Apple denies are simply what they deem "inappropriate," which could be anything from problematic coding (code that steals passwords or other private information), or app content that doesn't belong on the store, from porn to apps that help break the law or steal in some way. Apple is also vicious about trademark defense -- Schiller says that "if you don't defend your trademarks, in the end you end up not owning them."
That all sounds fine and dandy (ok, well, the "inappropriate" label is a little unclear -- that's broad enough that Apple could fit almost anything under that umbrella, which is a bit troubling), but what about all of those angry devs? Unfortunately, Schiller doesn't address at all the idea that Apple might someday allow devs to release apps that haven't been through their approval process, on the App Store or anywhere else. As far as Apple is concerned, it seems like they're keeping their grip on what gets released, and anyone who doesn't like it is welcome to go elsewhere.
Which is probably fine... for now. As long as devs release content on the store and the App Store remains the premiere outlet for mobile phone applications, Apple doesn't have much to worry about. Individual developers may raise problems, but as long as Apple is on top, they're free to dismiss those issues as extreme cases, and say that 90% of App Store interaction is simply Apple fixing bugs. Maybe Schiller even believes that devs enjoy the process.
But you have to think that if Apple continues to go slow and make mistakes with App Store approval, eventually the whole thing will come to a head. More developers will leave the platform, and other phones will benefit. If it ever gets that far, Apple will have to take a serious look at their process and figure things out from there. It's doubtful that they'll actually open up the platform -- much more likely would be a refining of the process and the rules surrounding it. Which is really all developers are asking for in the first place.
Unfortunately, it's not likely that will happen any time soon. The iPhone has a nice hold on the market, and even with the few high-profile developers that have split so far, the App Store is still doing brisk business. Schiller doesn't have to address individual developers like Rogue Ameoba directly -- for now, there's always more where they came from.