I had a similar reaction to much of Shu's Twitter feed to this news : well, shit, there goes some of my Deep Down hype. And yeah, that's an unfair reaction. There are some spectacular F2P games like DOTA 2 and Team Fortress 2 - but there are many, many more that are crap on crap, that see you paying through the nose for extra lives or energy or bigger swords.
I was always skeptical about Deep Down - it just looked like Capcom's attempt to capitalize on From Software's success with Demon's Souls and Dark Souls, which rarely works out well. Then it looked like Capcom's attempt to rip off From Software's baby while mixing in some Assasson's Creed (the game actually takes place in 2093).
Deep Down has only ever shown four enemy types and a bunch of very, very similar hallways and rooms. Beyond the cool fire effects, it doesn't look that impressive and I'm beginning to feel that Sony got the short end of the exclusives stick, as I gaze upon those impressive Dead Rising 3 demos.