Apple stock is down on the news. Although I'm personally underwhelmed by this announcement, I'll bet analysts are more worried about the lower priced iPad cutting into margins than they are Apple's ability to ship them.
It's the old adage: buy on the rumor, sell on the news. I wouldn't read too much into it. The only time I really pay attention to what the street thinks about Apple is when earnings are announced.
However, you can be pretty sure what the price will do a couple of days before and the day of an announcement.
Absolutely. Apple could sell all their products for 20-50% off and still make a profit.
This is not the business Apple are in. They do not want to.
Seeings they are the biggest company in the world, I suspect their decision to not reduce margins is working.