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What is there to complain about? The source code is available for anyone to download.

Clause 6 of the GPLv2 says that you "cannot impose any further restrictions" on recipients of the software. One possible interpretation of this clause is that the App Store terms of service impose further restrictions on recipients.

Thus authors of GPL software might have a basis to object to other people distributing their software through the App Store, even if full source is provided. ...at least, this was the rationale given by the FSF when they objected to GNU Go in the App Store:

http://www.fsf.org/news/2010-05-app-store-compliance

Apple doesn't own any rights to the VLC application being distributed. I thus see no legal basis for them to impose any restrictions, try as they might.

That clause in the GPL seems intended to cover distribution of a derived work, where the distributor owns the rights to additions they have made.

Edit: IANAL

My understanding was that to publish to the app store, the publishing developer must agree to certain GPL-incompatible terms and restrictions. Apple seems to think that their terms have been fulfilled but FSF has said that GPL and App Store terms seem to conflict. I think Apple is in the clear wrt GPL but the publishing developer may have violated its terms.

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