I don't understand why the Xr is considered too expensive. Last year, Apple sold the iPhone 8 plus for $799 at launch. The Xr seems to be a better deal for $749 at launch.....bigger screen in a smaller footprint, Face ID, A12 Bionic, more color options.....etc.
Maybe it is because people are comparing the Xr to prior Apple "economy" devices, like the iPhone 5c. But in terms of product positioning, I don't think Apple ever expected the Xr to sell to the same target market as the 5c.
Based on what Apple said at the Keynote, they are trying to offer most of the new technology features of the Xs/Xs-max in the lower cost and less premium package of the Xr. I think Apple is well aware of the fact that there are cheaper alternatives. The Xr is not Apple's response to the low cost competitors. The older iPhones (8, 7, 6s) are Apple's low cost offerings. I guess what has people worked up is that Apple no longer offers a new low cost option.....SE, 5C, etc.