The Neo is a great value, and will meet the needs of many everyday laptop users. It can also be a good option as a secondary computer (i.e. folks with a desktop or employer provided computer as primary).
That said; there are plenty of reasons an everyday average consumer might choose the MBA and pay the extra $500. For a moment, let's forget about the tech specs and performance, since for productivity and common computing tasks the difference under the hood between the Neo and MBA are negligible. What might matter to some are: screen quality, audio quality, backlit keyboard, battery life, MagSafe, better camera, and better trackpad. Many people that use their computers for common computing tasks spend hours each day on their laptops. And, they might decide that the MBA features are worth the extra $500 over the 5+ year useful life. One of the misconceptions on MR is that people who don't need Pro computing devices are not professionals or don't use their computers to earn a living. Nothing could be further from the truth. Laptops are the workhorse device for most working folks.
Anyway, if you spread the extra $500 over 5 years and figure 4+hours of productive use per day....well, the marginal cost might be worth it....more so, if you factor in resale/trade-in value. Consumers need to make this decision for themselves. But for most, it has almost nothing to do with the tech under the hood.