Nope, no go. It changes from installed to $29.99 and then gives me the option to buy the app again.

Follow this guide..

Re-Download Mac OS X Lion from the App Store

Also, part of the problem may be that you haven't downloaded the 10.7.1 update...
When you click on "Purchased", Lion might show "Update" instead of "Installed". Basically, Apple is keeping the App Store version updated as OS updates are rolled out via Software Update. If it does show "Update", you should be able to click that to have it download the new version.

I do have 10.7.1

That looks complicated, think I'll just leave things the way they are for now.

Try going to the purchased tab in the Mac App Store. What does it say for Lion there?

I bought Lion and upgraded my Mac. I wanted Lion for another iMac we have. I clicked it in the purchases tab, then I let it download again. Then I followed the instructions and burned it to a DVD. It worked out great.

__________________
Sirius Subscriber since 12-25-04
MBP 13"(mid 2009), iPad 4 (32g wifi), iPad mini (16g wifi), VZW iPhone 5 32g

Good info, thanks it seems I am always learning something new using my Mac! I just did a test and it works!

Once you buy it, it shouldn't go back to saying you need to pay again! Make sure you Apple ID is connected to your Mac. If you do that then it should show you everything you have available to re-download at no charge. Oh wait you just said that! NEVERMIND! hehehe

If you have 10.7.0 installed, now that the 10.7.1 updater is out, "Update" should show up for Lion in the Purchases section of the Mac App store (funnily enough, it *doesn't* show up in the Updates section). Click "Update" and it will download the new version of the installer and automatically run it. Just Quit out of it, and you will have the lastest updated installer (v.1.0.8 <-- no idea why it's that version, but the original that I had was 1.0.4), where you can then grab the .dmg

It seems that, at least under Lion, the re-download trick by holding down "Option" doesn't work.

So I updated my new MacBook Pro with 10.7.1 and I think I have the file saved onto a thumb drive, at least when I plug the drive in, I see a file that says "Install Mac OS X Lion"

Cool - just an FYI, if you only see the 1 thing there, then it won't be bootable. (A bootable image will have 6 files/folders as part of the image.)

You can turn the installer into an bootable USB drive by following this:
How to Burn Your Own OS X Lion Install DVD or USB Drive

Have fun!

Ya know what? My new MacBook has Lion and I will reformat the old one before I sell it to 10.6.1 and the new owners can update it to Lion if they want to at their expense.