As of Thursday, Wolfire had not heard back from iCoder. Apple responded to the developers on Thursday morning--three days after the initial complaint--with a short e-mail saying iCoder had been contacted. There was no information about how, or when, the matter might be resolved. In the meantime, iCoder raised the price of its version of Lugaru up to $2.

At the heart of the controversy is Wolfire's practice of making Lugaru's underlying code freely available for download--although the expectation is that other developers will use it to create their own games, Rosen and Graham said, instead of turning around and selling what is essentially the original game. And they say the terms of the general public license they use to offer the code lets them retain the rights to the game's key elements (like its artwork) while giving other developers a foundation for additional creativity.

iCoder apparently contends, however, that it obtained full rights to the game when it downloaded the Lugaru code. "While we do understand [Wolfire's] regrets, this does not change the fact that we have every legal right to market and sell the software, and we feel that $1.99 is a fair price," iCoder's Alex Matlin . (iCoder did not respond to request for comment.)

The kerfuffle may cause Wolfire to rethink its approach to making game code publicly available. But Graham and Rosen seem more focused on Apple's response to their predicament.

"We have been advocates of open sourcing because it leads to a lot of awesome modding and makes it easy for people to learn about how game engines are put together," Graham said. "But if Apple makes no changes to their policies, they will be providing a direct monetary incentive for developers not to risk doing so."