^That all may be true, but it doesn't answer the question of why the Federation just doesnt share the tech with the Iotians. As stated, the Prime Directive no longer applies, so why keep it away?
I think there might well be nuances and contingencies in the Prime Directive. There'd have to be. Seriously, you can't just hand a load of advanced tech to backwards cultures and hope for the best. Look at our own world.
The Iotians are presently a group of peoples with a corrupt gangster mentality who would really need to be educated before they could deal with advanced technology. Look at how in our own history new tech often isn't used for it's intended purpose but has been corrupted into something wrongly used.
Part of the problem with a planet-of-the-week type story is that the featured culture is only sketched out in broad strokes. The episode references the Iotians as being highly imitative, but that doesn't really say much. Humans are highly imitative in that we, too, mimic or adapt things we see that impress us in some way or other. But that is hardly all that we are. In a more credibly scenario some
Iotians would/might imitate some
aspects of the gangster era as portrayed in the book left behind by the Horizon
. But it's highly unlikey that the entire society would imitate everything related in the book. Add to that the book naturally doesn't tell everything about 1920's America.
Or put it another way: would you hand 23rd century tech, or even 21st, to the likes of Al Capones with the mentalities of that era? I wouldn't