They didn't launch the iPad 4 because of competition - the only reason they didn't do a silent upgrade (due to the feature set not being something that normally warrants an announcement and big launch) is because they wanted to let everyone know the product is new and good for an entire cycle, meaning one year (typical iPad refresh cycle). They will launch all iPads, iPhones, iPods in the autumn time frame, just before the holidays from now on.
Apple needed to get a 7'' tablet into the holiday market. Apple was already using market share due to cheaper Android tablets and needed to plug the hole. It also didn't make sense for the iPad mini to have newer features than the bigger iPad so they updated it. Updating it would also make the iPad a lot more competitive to the Nexus 10 and Surface.
Again, Apple might not be able to do full 1 year cycle anymore as seen with the iPad 4. If they have to get into the market, they will. Its better to release yours early than not release any at all. Google is expected to announce a cheaper $99, upgraded Nexus 7 Q1 of 2013.
They are currently having stock issues with the mini, in order to get ready for a new launch they would have to stockpile for weeks or months in order to meet demand day one. They would never do that when they have so much demand for the current product they can't meet it - it's not good business to upgrade a product where demand exceeds supply for the existing product. And there is a whole conversation we could have regarding the possibility that retina can even be made to work in the mini (while retaining the mini's main "magical" attraction, it's form factor and battery life).
Component makers for the second-generation iPad mini are supposedly preparing for an earlier-than-expected time to market despite Apple not completing the iPad mini's global rollout.
As for whether it can be even accomplished, it seems reasonable that Apple already had an iPad mini with Retina display prototype. There were reports and rumors, but Apple chose to go with nonretina and instead focus on a light and cheaper product for their first generation.
Apple does yearly (or longer) release cycles for all its products, and this recent mini launch (and iPad 4 "tag along") was the resetting of the launch date for the iPad family. There will be no retina mini in March or Spring time.
The competition will always be doing something, but I would never use it to predict any reaction from Apple. And any price drop for the Surface is due to lack of demand.
I just can't see Apple leaving a wide-open gap for others to take over during for 9 to 10 months. The fact is they won't release any iOS product in either spring or summer if thats the case. They could loose significant marketshare as Samsung will be releasing its Galaxy S4 around May. Say what you want about it, but its become the #1 selling Android phone and has sold a ton. It used to be the big iPad, but I don't see them updating the big iPad until the fall where HTC, Google, and Microsoft are expected to release big competitors.