How come people say the Xbox 360 can't have any more price cuts?

[Bitmap Frogs]

Million said:
The 360 is already below the price of it's competetion in the form of the Arcade , further dropping the price of the XBOX 360 arcade or Pro reduces the perceived value of the console , maybe even to a greater extent than the price of the console . As we all know perceived value is important , it's what affects the strenght/viability of a brand.

You are making the same mistake Sony did: aspirational marketing doesn't work on consoles and as such the perceived value derived from the pricepoint has a negligible impact.