*It is possible to make money as an Android apps developer.* You just need to find the right niche, or ideally a number of niches.
*App store optimization is important.* Having the right keywords in your description is obvious. Also think about other search terms used in different countries, for Cherry Chaser I added "one armed bandit" for the UK market and "pokie" for the Australian market. Adding keywords out of context to your description is somewhat crass but you can be clever and lever the desired search terms in there without being too obvious: "If you like one armed bandits or pokies, you'll love this game."
*Consider your app store icon.* You can give more information about your product with your icon. My original icon was the same as my app icon, a couple of cherries, it looked okay but didn't say anything about the app to a casual browser. My new icon looks like the type of slot machine that my app emulates. It gives the user a good idea of what to expect from the game. After changing to this image my app store downloads more than doubled.
*Android fragmentation is a myth.* At least the idea that it is problematic to developers is a myth. My app is running on every version of Android from 1.5 to 4.03 without any problems. I've even been told that it works well on a tablet, despite being targeted at lower resolution displays.