I broadly agree, but claims of impossibility face a burden of proof; and you can see iPads as cheap crude approximations to sealed systems, and they're effective enough that AFAIK most developers needn't worry about pirating. And I'm not sure but I get the impression that successive models of iDevices tend to take longer to find a jailbreak for.
See my post to another one of your comments as to why as far as I can see it is impossible to make a system that is completely unbreakable. But I definitely think you could create a system that is so difficult to break that in practical applications it would cost more to break then what is to be gained. The solution you suggested is likely a very good example of this. I'm not saying your proposed solution isn't a good solution to the problem or that it wouldn't work in the real world(if security is the only concern). I'm simply saying I don't there is such a thing as an unbreakable system, as long as it is deterministic.
