Bait and switch? The only thing that is bait here is the obvious clickbait title.

When you've laid out $19 million for the right to offer .blog domains then how do you suppose they recoup the outlay?

Reserving a list of 'prime' domain names is standard practice.

Whilst clearly they could have performed better in communicating to unsuccessful applicants, you shouldn't turn someone's disappointment into a journalistic piece on ethics.

PS. Paying the best part of $300 for a .blog domain is crazy. Owners of .xyz domains, which can now be bought for literally $0.01, will tell you that virtually all new gtlds are basically crap. Unless of course you own one off the reserved list ...