They spend a lot of that money supporting upstream contributions, maintaining a first-class Linux experience, providing real support, and otherwise putting their money where their mouth is.

Compare to almost literally any other laptop, where uttering the word "linux" gets you nothing more than a voided warranty and a strong YOYOMF, and some fraction of customers will see value in System76's approach.

Pixel for pixel, watt for watt, you could do better elsewhere. But only with a Windows preload and jumping through hoops if you ever have a hardware failure and have to reinstall the preload to run some awful diagnostics before getting an RMA, for instance. Awful experiences like that really take away from the "value" of a cheaper machine, if your time is worth money, as I suspect it is.