Oh yeah, that sounds like fun. Clearly a great way to be nickle and dimed to death in every application and game.
It looks like you're trying to copy and paste. Would you like to pay $0.05 in order to continue? (Continue/Cancel)
It looks like you're trying to exit the application. Would you like to pay $0.10 in order to continue? (Exit and pay $0.10/Stay for free)
It looks like you're shocked to see one of Microsoft's worst creations pwn your smartphone. Would you like to buy a copy of iLithium(R), iXanax(TM), or iProzac(TM) to soften the blow for $14.99? (Yes/No)
Obviously, this in-app payment feature was deliberately designed to be irritating and intrusive. Apple understands that, to most paying customers, the word micropayment carries a connotation of being slowly and imperceptibly bled to death by vampires. So perhaps Apple is going to provide an API which turns in-app charges into such an ugly, flow-shattering experience that nobody could possibly miss it -- which will also compel app designers to avoid using this feature unless they really have to.
"Most paying customers" are unlikely to have even heard the term "micropayment", let alone to have strong views on the subject.
A lot of developers may try to abuse this by creating tons of free apps with paid content. Then it will be impossible to know whether the apps your downloading are really free.
But I still think there's value in a free app that has paid upgrades, even if Apple has to classify them as "Mixed" instead of Free or Paid.
In fact for paid apps its even worse because the developer has already gotten the $4.99 from me(which used to be their sole source of revenue up to this point), so any additional money I'd pay would just be bonus, so they have no incentives not to abuse the nickel and dime option