So, Apple were required by contracts to block DRM music from other sellers but they weren't required to block non DRM music? I'd love to see that contract...
Apple was doing what's good for Apple, not what was good for consumers.
If only Apple get to sell music that can be used on the iPod then they would make money on every purchase = Good for Apple.
If a song or album isn't available on iTunes, but available in another store, then the consumer wouldn't be able to play it on his iPod = Bad for the consumer.
Except, of course, it's not that simple. Sure, of course Apple was looking out for the bottom line. If they didn't, well, then they probably wouldn't still be around. But let's consider some possibilities. From a strategic standpoint, Apple could have made the iPod capable of playing music from every licensable form of DRM out there. If they had done that, then even if the iPod had become the ubiquitous device that it is today, what leverage would Apple have had with the music industry? Answer: none. If Apple had tried to push the RIAA around, they would simply have pulled out of iTunes with the full confidence that consumers would simply get their music from some other music store to play on their iPods.
By contrast, because Apple chose to play things close to the vest, so to speak, and rely exclusively on FairPlay, when they gained a market dominant position they were able to push the RIAA for better terms on and, ultimately, remove of, DRM.
Did this strategy help Apple? Yes. Did it end up help all of us? Yes.
My main point is that a company like Apple can look out for the bottom line and try to do what's best for the consumer - in the long run, even if it looks self serving in the short run - at the same time.
Do I think that Apple always gets it right? No. Do I like every decision that they make? No. Do I think that they are passionate about trying to make great products and serve their customers as best they can AND have good profits? I sure do.