I feel that Sony would have been better served by keeping their powder dry and letting MS make the  first move , that way they could have controlled the power narrative that they held.

Nope.

Think about it. Since the Pro is old enough, they can make a $299 Pro slim or whatever and say, "hey, our console is only slightly weaker and $100+ cheaper".

People who see a $499 and $300-350 console will probably go for the cheaper

Using that thinking you could simply go for the PS4 , by waiting they could have cut any impetus that the scorpio gains right from under it , and the scorpio is really about stopping sony from gaining more ground in the US , anything more is a bonus.

I only think Scorpio will do some damage to PS4/Pro if it launches at $399. Otherwise PS is in the clear for the most part.

The whole power narrative was mostly PS fans going overboard because for the first time ever, everyone could clearly see that PS had the most powerful console. That is not something PS fans usually have the luxury of. (PS3 was stronger but it wasn't evident until later in the gen). The fact that not only did PS4 have the stronger hardware, but at $100 less than the XB1's weaker hardware, its not surprising the internet heard PS fanboys screaming about it for years. That rarely happens in any industry. You almost always pay more for a better/stronger product.

If PS never decided to launch Pro, would XB have launched Scorpio anyway? Would Scorpio still be made but held back for another year due to no competition? If Pro never launched, would PS just ride out Scorpio, quickly answer back with PS4k, or push the PS5 launch up? We'll never know.

Scorpio was put into production as a response to PRO iirc. Real question is did SONY shoot themselves in the foot by cementing the idea of a mid gen revision then being one uped on said idea? Would it have been better not to have made that move at all and not lose the mose powerful console title?

Nope. Sony wasn't going to screw the consumer by offering them overpriced hardware. $400 for what the PS4 Pro is is a fair price.

Nope. It didn't hurt the 360 by being out a year earlier and cheaper.

Not really. I see both the Pro and Scorpio as experiments for 4k gaming. It will be interesting to see whether the next gen consoles focus specifically on 4k. I do see 4k gaming being more viable to the mainstream by 2020.

If the Scorpio is about stopping the PS4 from gaining any more ground, then MS might as well cancel the thing now.

The sentiment seems to be no so far, and I agree. It's difficult for me to imagine a scenario where the Scorpio turns the tides for the Xbox brand. If anything. I expect it to have less impact on the landscape that the Pro did. Time will tell. It looks nice though. Very well thought out.