I really don't see the issue with selling a development platform that can only be used for developing your own apps on.

Unless google have marketed this as a fully functional android phone that you can *also* use for development, I don't really see the issue with $400 spent on a device dedicated to one purpose.

And it sounds like this restriction has a sound basis too, it's not an arbitrary ban, so you could do with loosing the sensationalist headline.