they must be refurbished or something. nothing else really makes sense
My theory is Apple is trying to kill 2 birds with one stone, WHILE still not dragging the Apple brand through the gutter called 'price war'.
1st bird:
Get rid of low end iPads before 2nd generation comes out. When the 2nd Gen iPads come out, higher end 1st Gen iPads can move down to the cheapest iPad slot.
2nd bird:
Their 2nd goal is keeping fence sitters from going over to competitor's camp, and this ties into the fact that this is the FIRST Thanksgiving/Christmas since the release of iPad.
There are people who are sitting on the fence trying to decide whether to get iPad or one of the competitors this Christmas, either as a gift for self or others. They are waiting to see reviews from initial buyers of Samsung Galaxy Tab OR better price/2nd-Gen iPads to be released. Considering this is THE FIRST Thanksgiving/Christmas since iPad was released, Apple selling a huge number of iPad in this season is important as it will determine whether Apple can dominate the Tablet market or not in the foreseeable future.
A tablet bought this Christmas will probably be the first tablet in the hands of a casual user, not a die hard apple user. And the casual tablet user will probably stay with the OS/platform that he gets on his first tablet. And Apple needs such casual users to sell lots of their stuff, since they can only have so much die hard Apple users. They've learned their lessons from iPhone.
As success of iPhone was a hugely important factor for Apple in every sense (the tipping point in creased brand recognition/stock-price/the helo effect), they know iPad is another important step to the next big wave of Apple, mainly media consumption market such as TV/movie/book. Dominating and locking in the tablet market thorough this Thanksgiving/Christmas is very very important for Apple
If Apple somehow fails to grab significant portion of next wave of tablet buyers (which will come this Thanksgiving/Christmas season), that means their grip on the tablet market will be loosened as more competitors release their products. They won't beat Apple obviously but still Apple won't be happy with nothing less than a complete domination of the tablet market.
So you ask but how many can they really sell through these limited number of stores to make a difference? Apple doesn't HAVE to sell huge numbers of iPads through these 3rd tier channels. But this gesture alone puts DOWNWARD price pressure on their competitors who will probably be forced to lower their prices, and Apple can continue pointing their fingers at the competitors' tablets and say, see they are cheaper and therefore are inferior to what we sell, the iPads.
BRILLIANT marketing team I must say.