Agreed. The price-raising is an interesting experiment but you can see why Apple might object to their store being used for an experiment.
It would be nice if they'd also (a) tell the guy why they kicked him off, and (b) set a new policy on pricing that prevents stuff like this. Even better would be (c) allowing him to reapply on the condition that he keep to the new pricing policy.
A policy that says "you can't experiment with your price"? That doesn't sound well-informed.
The guy wasn't doing anything wrong, he was just trying to maximize the income potential. If you don't allow vendors to experiment with prices, you're not a very good distribution channel.
Likely so. It's worth noting that Apple maintains a 90-day return policy on App Store purchases, though, so it's not like Tommy was screwing customers out of their money.