This isn't a question of censorship or a matter of control. Apple is simply trying to keep their store appropriate for their target market. This is no different than common retail stores such as Walmart, Best Buy, or Kroger's refusing to carry pornography. As long as any of these organizations allow other outlets to carry their own choice of material, be it pornography or otherwise, then these organizations should be allowed the same freedom themselves.
Probably the more questionable practice on Apple's part is the fact that they won't let you use your bought-and-paid-for iPhone how you want to (hence the popularity of jailbreaking them). More importantly, they prevent competing stores from selling applications for the iPhone (correct me if I'm wrong about this).
The issue isn't one of censorship. They have the right to dictate what products they carry in their store, and it's no different from what every other retail store in America already does. The issue is, instead, one of anti-competitive behavior.