There's nothing reckless about handing a child their favorite game to play.
Once you've been bit with a $100 charge for an in app purchase, you start to question the true utility of the password timeout. 5 minutes ago I downloaded the game on a new device for my child to play. Now they have unfettered access to my credit card account because I just downloaded the game.
Blaming the parent for being "reckless" in this scenario is little unfair. Being a parent is extremely difficult. It requires a lot of patience, thought, and understanding.
In app purchases love to trick the end user into accidental buying. What better demographic than the child who just received the car with the keys in the ignition?
As a parent who's recklessly had this happen to them, I facepalmed and sucked up the extra charges. Mea Culpa, but it does irk me that it's so damn easy to do.
Incidentally, in-app purchases have practically spoiled their nascent status as the handheld gaming platform. In-app purchases make sense for certain things, but they've ruined the app store for gaming.
I totally agree with your second point, IAP has spoiled gaming on iOS and that's the fault of the game devs for taking advantage of it. However if it didn't work they wouldn't do it and obviously plenty of people spend money via IAP. It's also their only choice. People are willing to spend more small amounts of money over time than paying a fair price up front for the game.