sean why do you consider creating and populating the Wordpress database (which are essential functions of an automatic WP installer) to be problematic?
I think that the automatic creation of a DB user with the same name as the app is ... problematic. Consider:
1) create Wordpress app 'myapp' : succeeds
2) delete app 'myapp' : succeeds
3) create Wordpress app 'myapp' : fails (after saying "Installing" for about 15 minutes).
How would you explain to a naive user what went wrong?
And what if you ask them to delete the DB 'myapp' and try again? It would still fail ... because they also need to delete the DB user 'myapp'.
Another example of a problem: normally the choice of name for an application is not a big deal. It is just the name of a subdirectory in the 'apps' directory. One can (I think!) safely create a plain vanilla application called 'admin'. But trying to create a Wordpress application called 'admin' leads to problems similar to the above.