They want centralized marketing, distribution, security and payment handling which the HTML option doesn't have. They could build a website selling these apps if they wanted, but that would be work outside of developing, which they don't want to do.
Everyone wants to be on the App Store because that's where you go for apps. You don't Google for "html iPad App RSS reader". So no one is going to install your app.
With the recent security issues with Android phones (this will happen with Apple apps too, but maybe to a smaller degree) Apple's controls are looking nicer and nicer.
Sour grapes.
Also, what's with the title "which Apple can't stop". You're thumbing your nose at Apple with a feature they developed and encouraged?