Actually, all the app was meant to do to begin with is to help a person prepare for the Sacrament of Confession. It's roughly equivalent to a sheet of paper that outlines an examination of conscience (what sins did I commit, how serious were they, how many times did I commit them) and the process of the sacrament (what Father So-and-so says, what I am supposed to say at which points). The app doesn't celebrate the sacrament in place of a priest any more than a piece of paper with that information would.
It's supposed to be a refresher for people who have been away from confession for a while, and a tool for helping people make better confessions overall.
From the developers' website (http://www.littleiapps.com/overview.php): "Designed to be used in the confessional, this app is the perfect aid for every penitent."
So it's not a disapproval from the Vatican, but rather a clarification. What Fr. Lombardi says in no way contradicts what the developers of the app are doing or saying.