In terms of the review/approval process, is it ok to use exit(0), under the following circumstance?
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An alert dialog pops up explaining that the app cannot be used on rooted or jailbroken devices.
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There is a button labeled "Exit App"
Or should I just let the app sit there doing nothing on the splash screen?
No. This is a terrible user experience.
You should display a modal view that takes over the entire screen, and cannot be dismissed, that explains why the app cannot function.
That's it. You don't need to give the user a button to kill the app. It's unnecessary and a horrible experience.