If it launches separately from X/Y, then your X/Y cartridge doesn't have to be in the 3DS slot? So how could they be sure you even own X/Y?

I could loan my copy of Y to all of my friends so they could download Z at the cheaper price. If each copy of X/Y would only authorize a single purchase of Z, it would be screwing over anyone who bought the game used.

It doesn't matter anyway, I doubt Game Freak would do this. They make way too much money abandoning all support for each game within six months and launching a new one at $40 after another six months.

Oh good point. Yeah they should probably make the game unplyayble if the card isn't in the hardware just like Pokemon Bank.

And I think DLC may have not been the best way to describe my OP. Will change it to expansion pack DLC. 

My bad, I don't think my description of it as just DLC was bad. It will function more like an expansion pack DLC like PC games which can also be bought separately on retail as stand alone games. But the benefit is that X and Y owners get the Pokemon Z expansion pack at a cheaper cost since the game isn't that much different aside from story content.

Why not follow the Fire Emblem IF's model? All three version are similar in artstyle in Fire Emblem IF but each version will have a lot of exclusive content and will be cheaper if you buy one of the version. So why can't X and Y owners download Pokemon Z for a cheaper price as well?

No. Because Pokemon fans have become far too accustomed into buying games they already own several times at the same price, it wouldn't be as profitable.

I think thats alot different, and with 15+ years inthe business, they would never do a DLC like that. Lowest Entry for pokemon was Crstal+Emerald at around 6.5mil each.

Srry i just dont see it :0

True the profit may be lost at first, but if the game/dlc have high sales, they make the same amount of profit or more.  

Typically, the 3rd version of each game sale little more than half of the original two. By making the price entry lower, the sales can increase especially from fans who were bothered about buying the same game again. Additionally, some people may not own X and Y but are interested in Pokemon Z. But since Pokemon Z is cheaper if they own X or Y, these people could buy X/Y and then Z. They could see the value of getting two new games at a reduced price versus one game.

If this model is successful, they can remake Pokemon Emerald and release it as an expansion pack dlc for ORAS as well and start getting profit from that expansion pack.

Which is significantly lower than their original two version's sale.

Imagine how much more sales Pokemon Z can achieve if they remove the price entry for previous X and Y owners. And good DLC pricing can convince people who are interested in Pokemon Z (or X2/Y2) to buy Pokemon X/Y and then Z because the reduced price for two games seems better than one full price game. 

I think that it would require a lot of effort to pull this model off with a series as traditional and old-fashioned as Pokemon, but if they can, props to them, they have at least some respect for people's money, instead of trying to ripped them off with a half-baked "full" game.

No, Pokemon Z shouldn't happen at all. They should wait and release the 7th gen with the next handheld at launch.