Apparently, there were some leaked scans that showed the X360 Pro at $299. But this was suspicious because there was no sign of any related price drops for the Elite or Arcade. So that immediately threw suspicion on the whole price-dro-across-the-board theory.
Now there's a rumor that only the 20GB will see the price drop to $299 because MS will release a new 60GB Pro version at $349.... GAH. JUST LIKE SONY!
So this could be a false alarm on the side of the "price wars." But none of the consoles have hit the mass market $199! Not even the Wii, which is the cheapest and is surely making Nintendo oodles.
Have both MS and Sony given up on price wars? Will they both stay as high-priced as they can, lengthen the generation, and not push for mass market? Does this mean they've basically given up on competing with Nintendo?
... of course...there's always the rumors that MS will show off a waggle-wand and avatars at this E3...