Just out of curiosity, how do you imagine that would work in the real world?
Apple's main thing is security, and one important aspect of how they achieve it is by only allowing signed code, which Apple also does some basic tests on, to be installed on the device. Many think this is a valuable service.
In the third party App Store scenario, does the developer still submit an app to Apple for approval? How does Apple then make the approved app available to the third party? How is this different from a website that gives App recommendations?
Apple seems to balance security and freedom in MacOS, by asking if you are sure you want to uninstall unidentified software, outside of the Mac App Store [1]. Why can't they offer that same balance in iOS? Imagine how different the MacOS experience would be (particularly for small developers) if every piece of software had to be installed through the Mac App Store.
I think the security expectations for those two platforms are very different, and that's why Apple balances them differently.
MacOS gives up a lot of security for those extra abilities, and on MacOS I don't feel like I ever really had security. For example, I begrudgingly run shell injection attacks on myself every time I download some large codebase, which I am never going to review all of, or run brew, etc. It has been that way since the very beginning. Not so with iOS.
Personally, I think the best outcome for everyone would be if Apple relaxed the restrictions on the App Store. Eg: not blocking an app update because they do not like the screenshots (I have personally suffered from this), letting third party browser engines (all iOS browsers use Safari web views), or even allowing apps that resemble their own apps (see what happened with Windmill recently because it competed with TestFlight).
That said, I would only agree (ideologically speaking) to Apple being as unreasonable as they are now if they allowed third party stores and let users chose which store they prefer. I really don't know how that would work but it would not be my first option.
Apple's main thing is security, and one important aspect of how they achieve it is by only allowing signed code, which Apple also does some basic tests on, to be installed on the device. Many think this is a valuable service.
In the third party App Store scenario, does the developer still submit an app to Apple for approval? How does Apple then make the approved app available to the third party? How is this different from a website that gives App recommendations?