As far as I see it, yeah, you are pretty much right about the pricing MS is using. I mean, they are doing it like the auto industry or PC sellers like Dell. I don't hate them for doing it, I mean, they are doing what they have to do to make sales (unfortunately, that includes a break prone system at the moment, any news on the newer 'Jasper' systems and their quality?). Right now it is easier to justify buying a base system for $200 and buying just the stuff you want later rather than buying a higher priced system and getting it all at once (of course, Blu Ray is nice, but you can live and play games without it, so are wireless controllers, but again, those are optional additions).
The Live fees are, well, there. The quality of the service and what is being offered is good isn't it?
Me personally, I am looking at getting a PS2 and some of the good games (God of War series, some of the Lego games and one of the Gran Turismo's, probably the newest since it is a Greatest Hits edition now for $20). I will probably get an Xbox 360 or PS3 someday, although the PS3 and linux is enticing to me, just not $500+ enticing.