I agree that this would be the wrong way to photograph a fish for sale, BUT......
I don't see this as damaging to the fish. In fact, I transfer almost ALL my fish with my hand if I can. Using (CLEAN and SOAP-FREE!) wet hands is less damaging to the slime coat than a net, and you don't run the risk of gill spikes or tail barbs getting caught and twisted in the net. For whatever reason, most fish act calmer when I transfer them with my hands vs. a net.
The other option would be to use a scoop. Great for fish with poisonous spines. My LFS sells a pretty good small plastic clear scoop for fish transfers, where you can keep as much or as little water as you want in with the fish. I have also used a clear gallon size bottle with the wide end cut off to good effect.
My personal beef with local fish stores is their tank upkeep. When I walk into a store, the first thing I do is walk the sales tanks and look for dead fish. Let's face it. It's the nature of the business to have casualties, and I wouldn't expect every fish to make it through transit. But the store staff should walk the tanks a couple times a day and fish any bodies out. It's bad for the rest of the fish, and it's just bad for business....what message are they sending if there are a half-dozen bloated bodies drifting in the current?? If they don't have time to police the tanks, how are they with other maintenance jobs? A single dead animal, maybe two, I might live with. If I see more than that, I just walk right out the door. There is a bog box SWF store here that is a big offender of this.