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Can't cut Kinect for the same reasons Sony could not add a second thumb stick to the PSP.
That's like Nintendo dropping the wiiu controller.

Besides it adds tons of value to the XB1, removing Kinect and dropping the price to $399 will give it less value than the PS4 at the same price.

MS will just have to ride this out or drop the price while leaving the console as is.
And if they drop the price this soon after launch it's going to drive early adopters that already own the console insane, we saw that happen with the first 3DS price drop, folks that owned the console went nuts because they felt robbed.