I whole heartedly agree with what Yehuda is saying here. If you're not writing a game and don't need direct access to the hardware (i.e. camera support on the iPhone/iTouch) I find it very hard to understand why you would _want_ to write anything other than a highly optimized HTML5 app. Wanting aside, I totally understand why people _do_ write native apps, both for reasons of integration-feel and for speed, but I'd like to think most app developers would rather have a highly optimized Safari and a robust / optimized Javascript API to write their apps with instead.
One area in particular where iPhone web apps fall short of native iPhone apps is scrolling. This friction might make sense for regular web pages rendered on the iPhone’s small screen, where by “regular” I mean “not optimized specifically for display on the iPhone”. But it just feels slow — stuck — on iPhone-optimized apps.
Did you read to the end? It's possible, with pure HTML, JavaScript, and CSS, to solve these problems. Apple has, and we don't need them to release "PastryKit" for us to get the same powers.
I was replying to your question about why it is sometimes better to have a native app, even though you may not need direct access to hardware - user experience is another factor.
Do understand that such a kind of experience may be deliverable today, with PastryKit or whatever someone else develops, but Apple can break this compatibility (which it cant do with its native SDK).
A new business model may exist where developers make advertising money off free iphone webapps. It is extremely naiive to believe that Apple will allow you to deliver the same user experience by bypassing the App Store.