Actually that's a cross compiler, and products made with it are almost certainly allowed on the appstore (I actually worked on a J2ME->iPhone cross compiler in 2008 when the appstore rules were even stricter, and products using our compiler were allowed on the appstore (though we were living in constant fear, back in those days it was much more ambiguous)). It's only useful if you've got the source for your android application, at which point you can recompile it into an iPhone app. It doesn't run a 'bare' android app.

If an actual Java runtime was made though, that would be banned.