Not all downloads are equal. There are far too many iOS games to make a profit. Had he spent the same amount of time/effort/budget making a productivity tool that catered to a niche market, he could have easily made a net profit.
Or because the set of people who want to mount an SMB share on iOS to get to their music... ah, while "consists primarily of you" is overly snarky, I think it's safe to say that it's probably vanishingly small.
There are all sorts of annoyances about the iOS ecosystem and a good chunk of them are driven by Apple's policies, but the notion that Apple cripples their system with the explicit intent of making it difficult to compete with them is hard to make a strong case for. Apple has their own direct competitor to Pandora, but Pandora is still in the app store. As is Spotify, and SoundCloud, and Beats (which was there before they were an Apple product), and iHeartRadio, and and and. Oh, you say you meant non-streaming players? A lot of people love Ecoute, but there's also Lagu and TuneShell and Listen and I'm sure others I don't know of, which have all sorts of tricks up their sleeve.
tl;dr: kneejerking about Apple is easy and fun! But there's enough actual things to kvetch about without "Apple hates their users, man" conspiracy stuff.