This was not entirely unexpected. It looks like Apple will stay true to its words and keep emulation apps off the iPhone for the time being. PDAStreet is reporting StyleTap is working with Apple but the fact that they're saying they may release through jail-broken methods does not sound promising.
I've used Palm applications for years. Games, office suites, and even tapping out a few short stories. This is what it looks like with StyleTap's Palm emulation running on an iPod Touch:
One way or another, we are going to see StyleTap CrossPlatform on the iPhone allowing users to run thousands of Palm applications. And if for some reason we don't, I don't see why the smartphone platforms won't adopt Palm emulation as a part of its functionality.
It's also reasonable to assume that any software developers spurned by Apple may end up on Android who promises a more open platform. We'll likely know in months after the first Android phone is released what kind of emulation support Google will allow.
However, it is arguable that Apple may allow emulation. Adobe and Sun both are said to be working with Apple on porting Flash and Java over to the iPhone, respectively. So, why not StyleTap?
I suppose Apple has many concerns in this matter but the main one may be erosion of quality apps developed for the iPhone. A developer may think if he can already get his app on the iPhone through emulation, he can save himself the trouble of actually porting or developing it from the ground up the same application. Personally, I think this reason along is not enough for Apple to ban emulations.
Note: This alone may not keep the jail-break community going but there's plenty of other things innovative programmers would continue to push for through this unofficial channel. We've already got NES, Gameboy, and Sega Genesis emulation working on the iPhone, I would think we'll see even more robust support for other platforms like Java and Flash pretty soon.
Just the same, quality over quantity may be what Apple is after first.
One more Note: StyleTap already works on Windows Mobile. There is a 14-day trial version. We'll have to see how StyleTap plans on charge iPhone owners if it does decide to release the app through jail-break means.