I'm starting to believe the maxim that the sweet spot for iPhone app sales is 13 to 17 year olds. Because some of them aren't spending their hard-earned 99 cents on an app - but the money from their parents.
Among my non-developer friends, it is shocking and depressing how few of those who have an iPhone have actually bought a single app. They know I do app development and yet some religously feel they should never have to pay for an app or they can find everything they want in the free apps. From personal observation, the real money in the App Store is from making apps for companies that want an app of their own, not from selling your own apps.