Here's how it works
For the rabid, unthinking anti-Apple types, the content doesn't belong to Apple, if you buy again, you buy from the rights owner (eg Sony). Fairplay (Apple's DRM scheme) works as follows. It's the same for apps as for music, and it's remarkably unobtrusive for all normal situations.
For one iTunes account, up to five PC's can be authorised. (you can de-authorise PC's too). Each device syncs with only one PC. You can have as many devices as you like (iPhones, iPods and yes, a few third party music players), but if you change the PC it syncs with, the old content is wiped.
So, the two big user unobtrusiveness plusses: 1: you, the misses and the kids can buy a song or App once and all use it on multiple devices. 2: DRM'd content/apps will work for ever without any monthly handshake with the authorisation mother ship.
And a comforting corollary of 2: you can never receive from Apple an email that, for example, Microsoft and Amazon have both sent out in the past: "We are closing our current service to make a new one. Please write all your music out to CD and re-encode it if you don't want your music player to die after we shut down the servers."
I presume the problem that Apple are grappling with is that with direct downloading to a device, a device doesn't know the full list of authorised iTunes accounts its current sync PC will have at the next sync, and in particular if the account you are using to "re-download" is one of them. So, by never syncing you iPhone (as many people don't), you can log in with your mate's iTunes account and "re-download" all his stuff at no cost, outside the license terms. What's the "fair" way for Apple to handle this? Handle it they must.