I think Series S qua competitor to PS5 is also interesting. The substantial price advantage for Series S won't make any headway amongst gamers that have any strict preference for Sony exclusives, or the aforementioned 4k players, but I do think that especially amongst parents and kids, wanting a console for Fortnite or Minecraft or whatever game comes next, this will be the machine. It will be bundled with minecraft, it will be bundled with fortnite. This is a sizeable chunk of the market, which is incredibly sensitive to price, sensitive to bundling deals, and insensitive to graphics performance.
Totally agree with you there, but not only that, the Series S will be the first "next-gen" home console to hit the $200 sweet spot. At that price point, it will be hard to resist as a secondary console. I think the only thing that might become a problem for the Series S is if Sony decides to keep manufacturing the PS4 Pro and price it at $300 (and $200 for the holidays).