I guess it depends which angle you're coming from.
a) If you think the larger iPad is a more desirable product, then the $70 difference looks weird - because why not just get a 'real' iPad for a few coin more / the mini should be way cheaper.
b) If you think the smaller iPad is a more desirable product, then the $70 difference looks fine - it's just a smaller, lighter iPad 2 after all (with a few hardware/software extras compared to the large iPad (camera, Lightning, Siri)).
Me, I'm squarely in the b) camp, and have been since the iPad was introduced.
So it goes.
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