...when you see it with 'RetinaPad' enabling the higher resolution it looks great and 'almost' as good as the much more expensive iPad Specific version.
And that's the reason I think they don't allow 'Retina' Res iPhone on the iPad. So they can let developers make more money charging us 'more' or twice for an application that doesnt look like ******
Yeah, the software tweak to make it run native should be beyond trivial. Seems like a few lines of code-maybe just a configuration file.
So...this does seem SUPER suspicious that it's just to let developers sell more versions.
If you take off the conspiracy-theorist hat for a second, and try on Apple's typical 'user experience' hat, you might see another reason why they don't allow iPhone apps to run at full resolution on the iPad.
(I'll admit up front that, like all the years Apple shipped one-button mice with their computers, it can occasionally be frustrating, but there is good, solid intention behind it.)
When they launched the iPad, Apple encouraged devs with appropriate apps to take those same apps and make them Universal with some neat new features added to the iPad side enabled by the larger screen/interface. During the keynote they showed many examples of their own built-in iOS apps, specifically highlighting all the improvements they were able to add for the iPad. For apps that weren't by their nature specifically targeting the Phone-only (or the Pad-only), Universal was the future.
While retina displays hadn't entered the picture yet, the policy of not running iPhone apps at retina resolutions on the iPad stems from this same encouragement. If devs could program an app once, at 960x640, and have it run great on the iPhone and look good running almost-full-screen on the iPad, the temptation would be to call it done. But running an iPhone app on the iPad completely ignores all the interface benefits of a larger screen. It goes against what Apple was trying to do with the platform.
You could look at the ability to run iPhone-only software on the iPad as merely vestigial. A once-needed feature to fill in the gaps while new software was being developed and existing software was being improved. Kind of like Rosetta on OS X.
The thing a lot of devs seem to be doing with charging for separate "HD" versions of apps that are otherwise identical to their iPhone versions is a perversion of Apple's intentions for the platform. You could see this recently with iCloud seemingly not allowing non-Universal apps (apps that go the standard/HD route) to access each other's data. After all, if the app is so different that you have to call it something different and charge twice, why would you be accessing the same data? Having separate HD versions of apps is bad for the iOS user experience, and therefore bad for Apple's products. It's not something they would encourage, even in dark, secret rooms, deep underground.