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With the sheer spec of PS4, Sony are going to have to sell it at a hefty price or take huge losses on it if they sell it cheaper. Either way both options could be seen to be a bit of a gamble. Wii U is only making a small loss which can be made up by selling a couple of pieces of software. This gives them room to make possible price cuts in the future should they wish to do so.
I also think Nintendo will finally get the message across regarding the gamepad,and again become unique as opposed to the competition.

PS can i ask, how high do you think dev costs will be to make high quality games that utilize PS4 hardware. My guess is pretty damn expensive, this could lead to an increase in software prices or having to sell a shit ton of games just to break even.