Recruiting, training and retaining 100 employees at a salary of $48k/yr - which seems like a pretty good starting wage to me - would only run them about $8-10 million a year, or ~0.2% of that profit margin. What the hell, double that amount if you need to rent/build a new office block for them. It would still pay itself in terms of positive press and developer relations.
40 reviewers each testing 40 apps per day is absurd, that's less than 15 minutes each. OK I know a lot of iPhone 'apps' do only one thing and have a novelty half-life of 90 seconds, but still.
These #s from http://www.macnewsworld.com/rsstory/67654.html
Right now the approval delay is about two weeks - that's not bad. Your testing cycle should be longer than that. An extra two weeks should not be a big deal.