The problem is that an application isn't
intuitively analogous to removable media at all. The last time I physically inserted a disc to run an app was in the CD Rom era.
The click-and-drag to the Applications folder step is also odd. Presumably the user wants to install the app if they've double-clicked it, so instead of kludgily hacking the file manager (oof!), why not simply prompt "Do you want to install [application name]?" [OK]/[Cancel]? How would that not be clearer? (Can you even install an app via the keyboard alone with that interface? I assume you must be able to, but it's certainly not intuitive that you could tab and enter your way to installation happiness.)
I appreciate that TFA is all about the creativity that can be added to this step, but it seems to me to be poor UI/UX design to allow so many possible ways of doing something so fundamental as installing an application. Sure, it's cool and fun if you're young and creative; but likely confusing as all hell if you're older and less-computer-literate.