Ashley, there's only one problem I see here, but it seems like a major one.
Someone using it for free gets unlimited updates, but nag screens
someone who pays for subscription basically gets a frozen version, so after 2 years, the free one is actually better.
Also, if it settles on a final model where some people couldn't update for free, the helpfulness of the community would diminish as some people would be asking questions, and there would be a constant,
"I'm using v1.2",
"oh, you should upgrade to v1.3, that bug isn't there"
I think it would be better for the subscription to wear off with the return of the nag screen. You're paying for the right to publish it commercially, it seems anyway, right? or are you just paying to alleviate the annoyance of the nag screen. I know pirates will do what they will, but officially, are you 'allowed' to publish with the free nag version?
Also, I propose a 3rd license model, an indie lifetime model, it would cost the price of the commercial model, but you would get lifetime updates with no nag screens, but still be limited by the 20,000 profit cap. I would definitely be willing to pay for that