I'd like an iPad with 32 GB RAM and 1 TB storage, retina display extreme, and 7000 hour battery life. Is that too much to ask at $500! Anything less is just not up to my fantasy.
Realistically, 256 MB RAM is good enough. I honestly am not trying to be a fanboi, but with OS 4, my iPad works better than ever and didnt cost me a cent. If you are experiencing worse performance, maybe consider doing a fresh restore.
Keep in mind how astounding the $500 price point seemed when announced? The profit margin on the iPad is less than the usual Apple product, so clearly this is what they could offer at the time. Obviously the part cost/performance goes down over time and the next iteration of iPad will have more RAM.