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I think that’s the rub, in my theoretical scenario, Apple is not blocking the distribution or sale of iOS applications through third-party means, they’d enforce their existing restrictions on and power over building iOS applications in the first place. Developers would absolutely still be able to distribute unsigned applications - end user iOS devices would just be unable to install them.
It sounds ridiculous to me, and as I wrote earlier, it would be a clear violation of the spirit of the DMA, but I don’t see any reason why this scenario would not be technically possible for Apple to pull off.
My hope, though I’m keeping my expectations low, is that since these supposed live-service games will be supposedly releasing alongside remakes of the original games the IP is based on, that if the remakes sell significantly better than the live service games it might hopefully inform better decision-making around them.
While they haven’t been controversy-free in terms of their monetization practices, Sega has released a slew of back-to-back AAA games: Persona 3 Reload, Like a Dragon: Infinite Wealth, and Sonic Frontiers, that have generally been complete, single-purchase packages (with a few questionable omissions from base game moved to DLC that I’d consider “regular bad”, but not anywhere near the level of egregious monetization seen in most live-service games).