It is my understanding that apps can also be installed directly from third party websites... This is not true, and that's the essence of the problem. You can

It is my understanding that apps can also be installed directly from third party websites... This is not true, and that's the essence of the problem. You can install software that you've written yourself on your own phone. And there's some sort of deal that lets you give your software to beta testers and let them install it. A year or so ago some clever fellow tried to use this beta loophole as a way of selling an app that was banned from the App Store. I believe they threw the book at him and he had to stop. I haven't heard of that happening again. You can distribute apps for jailbroken phones, but that is not really a solution.