Not to suggest that the DoD dudes are dishonest, but reading between the lines I think they just don't have the time and energy to implement their own sales solutions. What Gorath said about Steam refusing to sell future games makes 100% sense. (I also personally just don't use Steam. I also think there's more people not using Steam than not having access to a credit card.) Them turning down Avadon makes sense too, not because it looks "old" but because it lacks polish of any kind whatsoever.

I doubt it's common to have a first like this be a truly profitable venture, regardless of what you do.

I'd qualify that with Unless you get published on Steam. I think it would be mighty uncommon for a game that gets on Steam to not turn a profit.