Does this apply to all apps or just games? If it's just games then the claim may be indeed be legitimate (or not), but if it's all apps then it's certainly a case of overreaching by the trademark holder (or else an overreaction by Apple).
The most ridiculous element is the ban on the use of "memory" as a keyword. Trademark law was never intended to forbid others from naming competitors' products or from using trademarked words in their descriptive sense ("this game will enhance your memory and give you super-strength!").