I'm not sure the App store is even the target for this tool. This looks to be aimed at the "I want an app that does X,Y, and Q" Nothing out there does it but Google gives me the tools to make it.
Now users will be able to make the apps they want to do what they want. If anything this will clean up the app store. No longer do I need to go downloading 20 fart apps to find the fart I want, I can just make it and load it on my device. Now the 16 year old "Developer" does not make AD money from uploading his fart app so he looses the desire to make "Fart app 2: Even Wetter"

Also great for small to mid-sized IT shops who cannot devote a guy to develop in-house mobile apps. Now there is a platform where an app can be put out in a fraction of the time. This could be a great thing for the platform as a whole.

Stop looking at the overly cluttered landscape of the Android App store, There is a bigger picture here that we are missing. Google is very good at bringing order from a pile of chaos and delivering the best nuggets from it. The Android App store is just a self created pile of chaos and I think this is just the next step in creating that order.