If it had been much cheaper it would of bitten more in to Ipad sales for those on the fence of requirements
I think you're on the money there: it filled a real, but very narrow niche between the iPad and the MacBook Pro/Air - you had to
really need that extra portability - and not really care about connectivity - not to get a MBA/MBP, and
really need the kb/pointer-based interface and MacOS apps not to get an iPad. It undoubtably ticked the boxes for a few people, but now we have the Air offering a retina display on the one hand, and Apple apparently getting serious about making the iPad more of a 'proper computer' with iPadOS, that niche is only going to shrink.
Also, if you're dithering over whether you can get by with an iPad, the quality of the keyboard is going to be a major factor, and the nicest you can say about the butterfly keyboard is that it is divisive...
I think Apple realised that their upcoming 12" ARM Macbook is more powerful, better battery life and so on..
I guess we will see in fall or next year at latest
I'd be interested in seeing ARM-based Macs, but I don't think a change like that - which is going to rely on as many developers as possible building ARM versions of their applications - would happen without a pre-announcement at WWDC and some sort of development system available to developers in advance. Launch an ARM Mac in a hurry without a critical mass of native applications and that will certainly prove the skeptics right - 'cos its probably not gonna be very impressive at running x86 apps via son-of-Rosetta.
Looking at the way WWDC played, I'd say Apple's current gameplan is to work on making the iPad more credible as a laptop replacement - at least for the ultra-portable end of the market. Also, looks like Apple has had a couple of temporary 'exclusives' on new Intel processor models (e.g. the new low-end MBPs) and, of course,
one point of 'Apple switching to ARM rumours' is to keep Intel on their toes...