The market is indeed huge. Tons of people make their living building native iOS applications. Understanding your market and your business model are key just like all other businesses, as usual. For many companies making money from sales of the actual app itself is not part of the business model. The app is usually completely free, the app itself though is fundamental to the business model. Take Evernote, all the Adobe Creative Cloud apps including Lightroom, any/every banking app in existence, every major health and fitness app, nearly every medical app, etc. etc. Stop thinking about the app as the end of the line or a magical pot of gold at the end of the rainbow.
And, if you want to build an app as the actual product that you are selling, then do it right and you can indeed make a profit. I suggest you watch "Effective Strategies for Selling Out" by Josh Michaels, in a couple of weeks when the recording is release on the 360iDev site.