Agree to disagree.
I agree about the iPhone Jet Black 128 GB. I initially was going to pre-order the iPhone 7 jet black, when I realized it was only available in 128 and 256. Ultimately, I ordered an iPhone 7 Plus in gold (32GB). Unfortunately, I don't require 128 GB of memory for an iPhone and I was debunked from wanting the Jet Black color due to price point and memory I wouldn't require. And I also agree the 64 GB would have been tempting, if it still existed.
And I understand Apple's marking technique was to have those upgrade to 128, being certain individuals would flock to the latest jet black color, which is why I went with Gold and received my order relatively quickly.
Where I disagree, like you previously stated, is no one is going to say "Gee, I wish I had less space for all these Live photos, videos, applications, software updates." Which more and more are consuming the memory on these iPhones. If you had the choice between less memory and more memory for the same
Price point, you naturally would take the larger storage.
But if you properly manage your storage and understand how you use your iPhone's memory, then a lower storage isn't an issue for the time being. Some purchase the lower storage iPhone "Because it was the cheapest one they had." When in reality, the nostalgia wears off when they maxed out their storage and they are thinking "Perhaps I should have invested in the larger storage", which puts the customer in a corner.
On A sidenote, I feel these software updates are growing in capacity, 4K videos, Live Photos and applications are really dampening the iPhone storage. Ultimately, a larger storage would be future proofing your iPhone and is a "Safe Bet." I upgrade annually, but for those who don't, it makes complete sense.
And Let's not forget, after the iPhone it initializes after set up, you truly are not getting the "32 GB." It realistically is approximately 28GB of storage.