The problem with this analysis is that it assumes Apple has a strong influence over the price of apps. Sure there may have a subtle weighting for free apps in their search algorithm, but this is different to sorting apps based on price.

At the end if the day, if an app isn't free, it's down to the App developer community to set the price as a collective. However it only takes one rouge developer to trigger a "race to the bottom". In my opinion, it is developers who have created low prices on the App Store, not Apple!