Was there something you read that indicated that what they did wasn't allowed?
"Another angle on this, the ICANN people must have known about these applications long before they were made public. How could they continue this process, knowing that is how Google and Amazon interpreted the idea of new TLDs?"
Everything including the entire process and requirements were public and anyone could have read and determined the specifics prior to any submissions (and voiced objections). From my reading there was nothing to prevent this anymore than if you filed for .winer you could determine only your family could use it. (Same as you get to decide who uses scripting.com, right?)
At this point anyone can file objections to granting a particular TLD (the fact that you are the only applicant doesn't guarantee getting granted the TLD).
So I would suggest to the OP (Dave Winer) that he writes an objection if this bothers him which will also serve to alert the tech press.