Yeah. I see lots of posts saying CD drives were expensive and yes, there were some expensive CD based consoles (CD-i and 3DO come to mind from Phillips and Panasonic--two other companies that specialized in electronics and tried to break into the gaming industry like Sony). but when the N64 dropped, the PS1 and Saturn immediately dropped their prices. N64 may not have been $199 but I think it would have been close.
And to be honest, the $199 price was a shock back then even for the N64. Everyone expected $250 and then $199 came out of nowhere!