In my experience, an application that buys installs but lacks broad appeal falls off of the top lists as fast as it bought its way there. If it's up there long enough for Chris Dixon to notice, it's because there's a significant number of people who actually want the thing.
Chris's line of criticism both assumes that everyone's like us - they aren't, and there's a substantial demand for what you and I might consider 'crap'. The criticism also assumes that without this sort of gaming, the App Store would somehow be a meritocracy, which is ridiculous. Take away the install-purchasers, and the overwhelming majority of applications that appear on a 'top' list are there because a) they're already ridiculously well-known elsewhere, like Facebook, or b) they were previously given exposure on the front page of the App Store due to an editorial decision by an unknown Apple employee.
I suspect Apple will close off this particular line of business eventually - there's got to be a reason why they're tracking just how often and how long we use our applications, and I suspect it'll be for a usage-based revamping of the 'top free' and 'top paid' lists. But when that happens, the top lists still won't be fair, they'll just be a better reflection of Apple's editorial tastes.