Kairon is actually pretty close to the price factor. As of May or June, blue diodes were down to just $8/bulk. That doesn't include the whole drive, but it is still apparently a sharp cut. HD players of all kinds are going to become cheaper fairly soon.
By the fall, Sony could definitely lower the price by $100 and still not lose as much as they have been. At that point, what really holds the price up is the Cell and/or RSX. Nothing but more time and an eventual die shrink (if possible in RSX's case) is going to help there.