No, it's a ridiculous comparison. The Xeon processor alone
costs about $1400 while a Core i7 870
costs about $500. That's a $900 difference, not including the more expensive surrounding hardware for a Xeon. If you don't need a Xeon, that's fine, but comparing a single-slot Core i7 machine to a dual-slot Xeon machine is irrelevant.
While I'm not disagreeing with you on the costs, the performance differences between a single socket Xeon-based system and a i7 Bloomfield X58 system (or even a i7 Lynnfield system) are basically non existent (especially in regards to a i7 Bloomfield system vs. the similarly-spec'd Gainestown system). A case can be made though when comparing it to the i7 Lynnfields, but really only when it comes to bandwidth-demanding usage. Otherwise, Lynnfield holds up very well to Nehalem-based Bloomfields/Gainestown systems. There's no real way to justify Apple's usage of Gainestown in a single-socket Mac Pro. For the dual-socket systems though, sure.
Then the comparable Dell machine is not worth it for you either. Again, I get that Apple does not make precisely the hardware you want. If that means a Mac is a non-starter for you, then fine, but there's no need to try to make it seem like the Mac Pro is overpriced when, in fact, it's a pretty damn good value (I don't know if that was your intention, but that's how it came off).
It's a good value given its class of components. It's not a good value when looking for an expandable headless Mac and not needing the performance of a dual-socket system. There's absolutely no reason Apple couldn't replace its single-socket Gainestown Mac Pros with an X58 Bloomfield system.
In fact, given Apple's desires for largest profit margins, I'm kinda surprised they don't. The profit margins on a X58 Bloomfield-system would be much higher if they kept it at the same cost as the Gainestown single socket Mac Pro.
No they're not. They have very different parts and, thus, very different price points. This is not a matter of opinion. Different class of CPU, different number of CPU slots, different chipset, different drive capacity, different number of PCI slots = not similar at all.
I think he was more comparing performance. In terms of expandability, you're absolutely right (except for in regards to CPU slots). The single socket Mac Pro, as far as I can recall, does not have a second socket that is unoccupied. Thus, in that regard, it's only real selling benefits over a Lynnfield system are the QPI link (which has shown to make almost no difference in performance tests vs. Lynnfield's DMI implementation), the additional memory channel (performance difference only seen for bandwidth-intensive situations), and ECC memory (which is arguably its single best "advantage").
I'd actually like to see just how often Mac Pro users actually take advantage of the expandability of their systems. I've seen where music professionals have, and also where IT techs have added storage adapters, but otherwise, it seems the greatest benefit most have taken advantage of is being able to upgrade the GPU.
Why is a Mac Mini or an iMac totally out of the question for you?
Because users want to be able to have an affordable system that can be easily upgraded/expanded upon? And to be quite honest, the Mac mini (and entry model iMac) aren't exactly pushing the performance threshold with the current products. What happens in a year when the performance gap is even greater? At least with a headless tower you could add expansion cards to offer additional options (USB 3.0, SATA 6GB/s, etc) or replace the GPU.