Creating a cheap and bad product is a way leading to certain failure. There are multiple, very obvious reasons for this.
1. The amount of people that will buy Rift right off the bat is still not a huge amount of people, so having a cheap product that relies on tons of sales just wont work. There just wont be tons of sales for the first generation of VR.
2. If the Rift is bad experience cause they cheaped on hardware or research to keep the price down, VR will get really bad word of mouth and will never ever take off. Word of mouth is everything since trailers or posters can't really sell VR well.
3. The enthusiasts and business customers (for anything from museums to B2B visualisation stuff) have no problems with a "high" price on the device (it's not high for a company), but they every problem with a bad device giving their end customers a bad experience.
I, in fact, think the first generation of Rift should be even more expensive (but better). Just like the first PCs were extremely expensive, or even how DVD players were really expensive in the beginning. They were succesful anyway cause they were good products and as years went on the hardware became cheaper and cheaper; right in line with the potential customer base growing, mostly based on word of mouth (as is always the case for new tech).
