Other computing devices have screen savers, so it's why many would be "mislead" to think it's an actual screen saver app that magically enables their iDevice to show screen savers.
The subset of iOS users who would consider an instance of iOS hardware to be "a computing device" is quite small, particularly given the app store policies which discourage apps which allow iOS devices to be used for general purpose computing.
And in any event, the App Store contains products of similar functionality, e.g. live wallpaper.
Yes, and look at the reviews. All of them were deceived, they think it's a scam, they demand a refund, they probably feel less safe about buying anything from App Store again, and other iOS developers pay (only slightly) the price of this "scammy" app. Apple should get rid of all such apps – it's better for the business (of Apple themselves and other iOS developers).
Why they approved "live wallpapers", but not "xScreenSaver"? I don't know. It sucks, it seems that their reviews are not consistent.
But just because they made a mistake (like approving "live wallpapers", which IMO is a misleading app created solely for the purpose of milking a few hundred dollars from naïve App Store customers) does not mean that it's okay to do it again.
And in any event, the App Store contains products of similar functionality, e.g. live wallpaper.
http://itunes.apple.com/us/app/live-wallpapers-pro/id4994091...