There is no reason for them to make a differ model when they already seem to update the exist model annually.
Let's say Apple made a lower end 4 model. It wouldn't make sense for someone to purchase a lower end 4 when they could probably get a regular 3GS for the same price or cheaper, which would be just as good or better than a lower end 4.
Then you can imagine all the cry babies .... Why does Apple treat us lower end users like crap? Why are the updates not geared towards my iPhone? Blah blah blah?
And ofcourse the iPhone is like it's own entity. OS, Hardware, AppStore, ITunes, etc: It's ALL Apple. Unlike having a Android phone made by a separate manufacture and having carrier specific UI tweaks.