True... but think of the upsell potential.
The "old" 8GB iPad 2 for $399... or the "new" iPad 3 with better screen, twice the storage, faster processor and better cameras for only $100 more.
I think you'd be crazy to get the old iPad for $399 if the new better iPad is $499... but there are some people who are very motivated by price.
The same thing happens today between the iPhone 4 and iPhone 4S. Sure, the iPhone 4S is double the subsidized price of the iPhone 4.... but it's got twice the storage, it's faster, better camera, etc. To me... the iPhone 4S is the only way to go. And since the 4S is the best selling iPhone... other people agree.
However... a friend of mine got an iPhone 4 a couple months ago. She said she didn't need the storage and speed of the iPhone 4S... and she's perfectly happy with the iPhone 4 at $99
I think Apple is doing the right thing by making older products more accessible to price conscious customers.