don't they already snub publications that they don't like anyway ?

Yes, if they want to be petty about bad publicity, there's other effective strategies like denying access to the publication as they did to Gizmodo back in 2010.

I don't think it's an either/or. They should do what they announced today and sue for defamation. When they announce the suit they could state that they intend to donate any awarded damages/settlement to charity to counter the "Big Company sues blogger" stories. But I think the reputation damage is very real and it would give Apple the opportunity to testify under oath (if it went to trial).

Even if they took publications to court, the public opinion would not change for the better because people stop paying attention to any story within two weeks of when it's revealed. The damage has already been done. The only potential reasonable argument to do something like this is for Apple to scare off other publications from publishing damaging headlines in the future. But the benefit of this strategy would be little when balanced by the negative PR hit it would take by every other news publication writing articles and OpEds on Rich Big Corp vs small, struggling, important-for-democracy news organizations. There's no faster way to torpedo your public approval than to go after news publications.

I think you’re both overstating how widely known this controversy is and understating how bad suing a tech blogger would look (see: Streisand Effect). I’m a techie and have barely heard about this. People who went and bought new phones will be pissed, but the majority of users won’t care.

This response owns the responsibility of countering misconceptions. The huge majority of Apple users won’t remember this in a month.