Preventing iTunes from keeping old versions on "Mobile Applications" folder I just manually deleted about 1gb of useless old version files from that folder. But I've got 966 items there and no way to going through them all, plus some of them are not even that simple to identify as being an older version of the same app since they change names.

Is there any way to automate the process? Why are they kept there in the first place?
I don't know an easy solution to change iTunes, but I do have a cleaner library by letting go. It's not exactly what you ask, but here goes anyhow.

I did one good backup of my user folder and then deleted all apps from within iTunes. Then I cleared out the folders to remove any left over / orphan app files.

Then I connected my devices one by one and just transferred the purchases. Less updates of un-needed apps and less space used.

I suppose they could pull an app from sale and I might miss out on some updates, but I'm willing to take that risk. I've still got the last version I wasn't using stored on my backup.