Why isn't apple stepping up to defend these app developers? I am sure they would all fight if apple's deep pockets protected them directly.
Apple did step up; that's in one of the referenced articles:
Last April, "...Apple's motion was granted in part: Apple is permitted to intervene in this suit, but such intervention is limited to the issues of patent exhaustion and licensing."
(I haven't seen any news since then. The case changed judges, so perhaps it got delayed.)
Apple's argument is that their license should extend to all their customers, business partners and app developers.
Lodsys' argument is that they only licensed Apple to use it in their OWN products.
It seems like it's all going to depend on the wording of the contract.