This maybe was true 6 months ago. It isn't true now. Android buyers today are the mainstream, many of whom are paying as much for their handset, and as much on their contract, as the iPhone equivalent. They are competitive choices, and there is no longer any clear demographic difference between buyers.
You don't sell 300,000+ handsets a day targeting the geek demographic. My brother and his girlfriend, who I thought were the pinnacle of the iPhone demographic, I was recently shocked to find got a HTC Desire Z and a Galaxy S, despite their other household devices being an iPad and an iPod Touch. I had no part in that decision as I keep my evangelism in the online world.
As an Android buyer I've only purchased three applications in my history with the devices: WeatherBug Pro, a top-rated racing game that I then returned, and NFL's Game Center.
Am I cheap? Quite the opposite: My steam catalog is stuffed to the gills, and all of my music is legally owned (on top of a rdio subscription).
I want to spend money on Android apps. I want Angry Birds to have a pay version so I don't have to worry about my kids accidentally clicking on ads during play.
So why don't I spend more?
Not only is the market app terrible (the lack of decent heuristics being the biggest deficiency), as a long-time Android booster I will openly say that the majority of Android applications suck just as strongly. It's getting better, but in general it's still quite a gamble if you're getting something decent or not, and I can't imagine the 15 minute window has improved confidence levels.
It isn't always the app's fault, either. The racing game I mentioned seemed decent enough, but the constant garbage collection of the platform made it a pause-filled, unpleasant experience. This, of course, is one of the things that the slow-to-come 2.3 release (remember when the purpose of buying the Nexus One was supposedly fast releases?) aims to solve.
I actually felt guilty returning that app because it wasn't really the fault of the app's developers, but it made it unplayable.
The NFL application I only bought after actually seeing it on the NFL.com webpage. I had found it in the market search previously, but didn't buy it because there is no guarantee that "NFL Enterprises" is actually NFL Enterprises, or if it's some guy calling himself that. The Market also needs, optionally, something like Authenticode/vendor verification. I would not in a million years trust a purported bank application independently discovered on the Android market because there are zero guarantees.
To link myself, I talk about the market here - http://blog.yafla.com/Android_22_Engravings_and_the_Google_N..., the core takeaway being that the Market needs the ability to link a third-party rating authority. The biggest incentive for people to go through the buying process is the comfort that what they're getting is worth it. The current user review system offers no such confidence, usually offering up nothing but petty grievances and obvious shill accounts of the author's friends.
I'll take the Android model over the Apple model any day of the week, but there is an even better medium that would be ideal.