It might not be as much of a problem in the US, but it is a real pain in the ass people have to contend with, for example, in Russia. I've seen it myself. Apple is enforcing US sanctions against some Russian companies, which means they can't have an iOS app. At all. I heard stories about how a sanctioned bank would load some kind of shadily signed copy of its app onto people's iPhones in branches. For Android, that same bank just hosts a self-updating apk on their website — with no intermediates to tamper with their app distribution.
Besides, being able to install modified apps is an important leverage against companies that don't act in their users' best interest. This way you can still use their services, but do so on your own terms.
1. They don't think about these kinds of second-order effects. They see that this company is somehow involved with the government and that's it. Their electorate won't care about these kinds of details because they're "doing something" to supposedly stop the war sooner.
2. They think that Russians would somehow revolt against the government. This doesn't work — the Russian government lacks any meaningful feedback mechanisms. By protesting, you'd expose yourself to immense personal risks for no discernible effect. Unless you're a heavily armed private army heading straight for Moscow.
I strongly disagree that these are the only 2 possible explanations. The first is clearly not true — these second order effects are well known and often discussed, and the fact that sanctions are used in circumstances when the population is not expected to revolt shows that the second one isn’t the only remaining reason to use sanctions.
Besides, being able to install modified apps is an important leverage against companies that don't act in their users' best interest. This way you can still use their services, but do so on your own terms.