Here's what I don't get about Apple, aluminium is a more expensive metal than stainless steel, fact, they use aluminium to make their iPhones iPads etc, what's made out of stainless steel, belts, cutlery etc, so how can they justify charging £200 more for an Apple Watch over a Sport?
I'm far from an expert on materials science, but I know there a huge number of different alloys of stainless, I can't imagine the steel used in the Watch is the same grade as the cheap stuff used in cutlery, what else they put in it or do to it to make it so much more expensive I don't know.
It's more likely that the difference is simply that aluminium is light (making it better suited to a sporty version) and stainless steel is very durable and hard wearing (making it better suited to a more "premium" feeling version) - it could well be that the Watch units are in fact cheaper to produce than the Sports, and Apple is laughing its way to the bank yet again with its incredible markup.
Edit: of course, there will be a cost difference between the sapphire and the Ion-X glass; this might tip the balance in the Sport's favour in terms of cheapness.