The mini's price doesn't allow them to have a sizable markup, therefore it's not a product Apple likes.
Well, it's definitely a nice product for those switchers. I know the bottom line Macbook has way better bang for the buck and costs a little more; but there are plenty of people that don't want a laptop or spend that much money for the first Mac experience.
I love the mini. Quiet, small, power efficient. Want to get one for quite a while now, but they're still a tad too expensive and underpowered. If the high end model cost as much as the low end currently, and the low end was (pricewise) dropped accordingly, I would take one. Just to have a little home server that records my eyeTV shows when my Laptop's not at home, to have the Time Machine Drive (and all those other externals) connected so I can backup wirelessly, etc. All things you can do without having a keyboards, mouse and screen attached. I can use my Macbook and use remote Desktop when I need it.
I would be sad if the Mini was to disappear. Prices would got up on eBay... they're already higher there than what my edu discount gets me for a new one.