I get that, but after all it's not really Apple's choice what their buyers do with their devices. If they overwhelmingly decide the iPad is a nice base for this kind of application, Apple can either embrace that decision and cater to these customers (of which a good part are obviously ready to at least pay more than those $200 for the cheap Android tablet option, probably because of better update support as suggested by that other comment alongside this one) or try to make the device appealing to other target markets that they'd like to be in.
But when those other markets don't really take the bait, at some point it might be a good idea to accept that there is a market, but in a somewhat different place than originally anticipated.