That emulator that you're referring to was famously rejected from the App Store because it had the ability to launch other executable code, as in, what emulators usually do. They had to make sure that it can only run everything that was bundled with it and nothing else.
And while there was no Files app on iOS, you did have a file system and you could in fact add arbitrary files to applications using iTunes. Here's a 13-year-old tutorial on how to add PDF files to a PDF reader app:
So it would've been extremely possible to make a generic retro game emulator like Delta on iOS even back then, but obviously Apple did not allow it.
Why are you trying to show us we can transfer files with iTunes as if we are born yesterday? Anyway…
That C64 emulator was indeed pulled because there is a risk of a rom being crafted to exploit a system. The emulator wasn’t a popular download anyway. Almost all of Sega’s retro apps on the App Store are Mega Drive emulators wrapped in a skin. They don’t sell well either.
As for the risk of malicious roms, that remains true now with side loading but the main security problems will always be the apps themselves and the permissions they ask for. Copycat apps with malware have also been abundant on the Google Play Store and as we know they sometimes slip into the App Store.
Hell times are coming. No doubt cyber criminals are paying a percentage to the European decision makers.