Recently purchased app disappeared from v2.2 iPod, became v3.0 app

Hello,
I bought an application in the iTunes store a few months ago. Last week or so the application disappeared from the iPod touch (running OS 2.2.1). The app is in iTunes but does not synch, but no error.
Today I tried to install via iTunes App on the iPod itself, and I get a "OS version 3 is required for this application". The developer tells me that this is due to Apple's management of applications on the iTunes app store and tells me I should take it up with Apple (how?).
I didn't and still don't want to upgrade my OS to v3 and now the application that I paid for is gone. I feel, to be honest, ripped off, despite the relatively small amount of money. I am surprised that apps are not backwards compatible and I see other apps being updated all the time.
I don't mind living with less features in the app when the OS progresses, but getting one's purchase made void by means of an OS change seems like burning my money. Don't think I will feel like paying for an application again in the near future.
Anyone with a similar experience? What can be done?

Hi, trying to function ITunes "Restoring Iphone"?
Таким образом, восстановить заводские настройки.

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