The 'PDA' business is still young, and always changing. It's supposed to! The PC world took forever to stabilize. And it too is once again being shaken up. Windows, Mac, Linux,... oooooh is the fragmentation going to kill the industry there too?
Whatever.
This has less to do with mobile devices and more on the design of software. And there is plenty of room for both, native apps and web apps. The applications and industries vary wildly, and it's a big world out there. To limit it to the view point of only a select focus (U.S. telecom, consumer users) is being ignorant.
This same scenario exists on the PC side. And people still make money on so much native software that it's surprising to the web app zealots.
With the web comes new tools and applications. The iTouch relies much more heavily on its native side then its connected side to deliver the user experience.
The politics of hurting developers by installing barriers for people to get their software on their mobile is only going to kill the device manufacturers/platform makers. Apple is feeling this and has chosen to release an SDK to gain support. Otherwise, it's iTouch PDA is just another toy, versus a real tool.
Don't fret native developers. There is plenty more work to be done yet.
And many more markets to exploit.
