Double the price is still way too high, even considering the smaller market.

Canada also has 10% of the population of the U.S., but we're only paying a $7 premium ($39.99CDN ~ $37US vs $29.99). Sure, Australia has higher shipping costs vs Canada, but that doesn't add up to double the cost.

Europe is even stranger, they have more people then the U.S... Yes, there's localization issues, but I don't buy that. I work for a buisness software company, and we localize to 4 languages at release (english, french, german, japaneese), and then to another set of languages (portugeese, russian, italian, finnish, dutch, sweedish, mandarin, and spanish) a few weeks later. It costs money, but not *that* much money. It used to take us a long time to localize, but my company learned that you have to think of it front and center, which made it much cheaper and faster....

As a side note on localization, I can say it used to take my company a long time to localize, as we'd release in English first and then worry about French, German, and Japaneese, and then the others much later. I think game companies are still following this approach. Changing to do multiple languages at the same time was a shift in both culture and how you program, but it's definitely paid off. Localization used to be painful, but now you hardly even notice it.

 No, i bet you only have to localize text. Thats simple and right done cheap. If you have voices it is just not cheap anymore. You have to pay the speakers and the "Audio Studio". 

Despite the higher price, it still seems to be doing pretty well in UK and Germany.