That kind "popularity content" policy will never work because because then scammers will just buy apps with good reputation. This describes the entire browser extension marketplace. Any extension with a good reputation and a broad permission set will sell for a good bit of money.
There have been too many cases of a popular app being bought by scammers and repurposed. They can't exempt an app from being suspended just because it's popular.
I would rather apps be automatically suspended and the install marked as potentially dangerous than have my device goatse'd to a malicious developer for any amount of time.
That can be accommodated. Automatic suspension that lasts 20-30 minutes while someone on the team looks into the case and makes a human judgement.
But a full suspension, on a popular app, without rapid human review? That shouldn't happen.
Also, this wasn't up to the "install marked as dangerous" level. They just prevented new installs. In a situation like that, there's no need to act instantly.