1. They never pulled the plug on the Litecoin miner. They had never promised any kind of Litecoin miner back then. It was me hassling them non stop to make Mars into one, that's how I struck up a rapport with Sam in the first place, it's in this thread. His response always was the entire point in Mars was to prove of concept of the ASIC code working. He took aboard my comments, and even started a poll on the KnC site, when the volume of people voted 'yes' we want a Litecoin miner KnC only then promised to revisit the idea after the ASIC. They weren't going to develop multiple products simultaneously as that would heap ordinate one or the other project. Now they are working on an FPGA miner.
He made the right call. Litecoin on FPGA is difficult, the performance gain over GPU is marginal (lower power, but cost per hash is similar if not more expensive). There are several products coming to market soon (Jasinlee, Koolio, perhaps Funnow later), and Beekeeper has a demo board. And there are some obvious scams too. There is also an open source miner, though the performance is rather poor.