However, I think its good because it allows developers to further differentiate themselves from the pack. What apps get featured? People bemoan the fact there is so many apps competing. But I believe that if you write a compelling app that stands out from the hum-drum tab-bar apps and, yes, glut of physics-based games, your reviewer at Apple will notice. They probably even get some kind of bonus for identifying the diamonds in the coal.
Thank you and muchos gracias, Apple. I believe that apps that push the limit of what an iPhone current generation can do - and do it beautifully - that is what will win in the marketplace. Uzu, that addictive slice a shape in half game, the render a photo like an oil painting. All require secret sauce - in development time, graphics, rendering.
Titanium mobile won't for a very long time be able to make a Uzu-type game. Or even a well-designed app. I hope...
Prepare to be flooded with ports of Flash games (I assume this makes Adobe's compile to Flash in CS5 feature a go, now)