Were Facebook's Loose Limits Self-Destructive?

One of the largest benefits for developers building applications on Facebook are the less restrictive policies on the Facebook platform. Well at least the less restrictive policies of yesteryear. While Facebook has increased their restrictions on the virality of applications, there are still relatively few limits on the type of content that can be displayed within applications aside from not displaying pornography. This is in contrast to sites like LinkedIn where all applications are subject to strict approval.