I tend to agree. I have seen several times this year these types of discounts. I purchased my Air back in March from BB with a similar discount. Not only BB but quite a few vendors on Ebay offering similar deals. It's not just Apple. Amazon has been aggressive the entire year discounting their HDX tablets. Samsung tablets as well have quickly been discounted with BB dropping the price of the Galaxy Tab 8.4 from it's regular discounted price of $329 to $279 so you factor full MSRP of $399 and that's $120.
There's quite a few articles stating that tablet sales in general are losing steam as the market becomes saturated. It's good for the consumer as Apple will have to get a little more aggressive in trying to get consumers to upgrade their iPad's.
The problem with tablets is that they are really only used by the average consumer for media, and media doesn't take the latest and greatest processor to run. Even an iPad 2 will do the trick very well.
With iPads, you also have to shell out the entire $500 in cash, vs 0-$200 for a new iPhone.
Also, $500-$700 is what most people pay for laptops. (A fact us mac users understandably forget) At that price, most are upgrading their iPads on a laptop upgrade cycle.
I also have to be honest - the iPad is my least used device. Its cool for the couch or when you don't want to break out the entire laptop, but other than on the go it's much easier to use my phone. Admittedly, I'd probably use my iPad more if I got an LTE version.