delericho
Legend
For me, WotC developing a new system from the ground up is enough added to explain the price difference. Paizo had an incredible head start with 3.5, and didn't have to recoup the costs of creating Pathfinder from scratch.
I think there are four reasons Pathfinder is comparitively cheaper than D&D (any version), of which you name one. In addition:
- At the time they were producing Pathfinder, Paizo were still the new kids of the block, and had published zero RPGs. As a result, they had no pre-existing reputation to fall back on, and really needed people to buy into their new game. This probably led to them offering as good a price break as they possibly could. (Of course, if and when Pathfinder 2nd Ed comes along, this will no longer be true. That time will be very interesting, for several reasons.)
- The Pathfinder rulebooks aren't actually the core of Paizo's business; they're support products that are used to drive sales of their adventures (actually, subscriptions to the Adventure Path product). Because of this, it makes sense to offer those rulebooks at as good a price break as possible (and offer a very-low-cost PDF version, and put all the rules material online for free).
I'm a big fan of Paizo - I like the range of products they offer, I like many of their products, and I like the way they do business generally. But it's simplistic to say "Paizo can do it, so WotC can too!" - they're different companies with different approaches and different constraints. What works for one probably wouldn't work for the other, whichever way you choose to do the switch.