Basically, this is opening the flood gates for nickel-and-diming microtransactions from the App Store. Before, when you spent $5 on a game, you knew you were getting the whole game—with free upgrades. Now, you'll spend $5 on a game and you'll need to spend another $5 to unlock all the levels and weapons. And that's on legit apps. Just wait for the novelty fart apps with one fart sound that want you to pay for extras, or a flashlight app that wants you to pay for different colors.
This could easily turn tons and tons of apps into crippled trialware without consumers knowing, and it's going to make developers hungry for the extra cash they can make by charging you for extra feature they would have included in the full version anyways. Like a game charging you $3 for fancy horse armor on the Xbox 360, but without the filter than comes from the huge budgetary requirements of Xbox 360 games, this is going to open the floodgates for the sleaziest app behaviors possible. The worst part of it is, there will be enough people willing to pay a little here and a little there to support this kind of behavior. But I for one, am out. Do not want. [Gizmodo's iPhone 3.0 Coverage]