Perhaps you might say that would be fair, but it is a world that suits me less than the current one.
You don't have to come up with hypothetical scenarios if you already have a real life example to look at.
But once Meta, Epic etc can run their own stores on both iOS and Android they will absolutely move their apps to them. Epic has already said how important this is to be able to implement their metaverse strategy.
Google even took steps to prevent people from installing malware pretending to be fortnite, and steered them to the official installer. Not out of the goodness of their heart, TBF.
anyway, here is a real-world example of the type of spyware that facebook and others will deploy once they have the leverage. again, remember that this already happened and most likely still exists and is something they have ready to deploy again if the opportunity presents.
https://arstechnica.com/gadgets/2019/01/facebook-and-google-...
On Android, you have to abide by Google's rules if you want to be in the Play Store; Amazon's if you want to be in theirs; F-Droid's to be there.
Consumers have choice over whose rules they care about. In a hypothetical iOS with app store competition, what you write would presumably still be true for the Apple App Store, there just might be an 'F-iOS' or whatever that insists the app is open source too, for example.