I get and agree with most of your points except the idea that the difference between and S2 and SE is just where the body was made. They are definitely different feeling guitars. comparing S2 custom 24 to SE custom 24, the S2 has a bigger beveled maple cap and if course as you point out, have locking tuners, and a few other small features to set it apart. But it's not the small features that make it nicer. It's the final product (call it craftsmanship, call it feel, whatever).
since we seem to like car analogies, the SE and S2 guitars are like comparing a Honda to an Acura. They are made on the same platforms and share many parts. From afar one might say they are basically the same why would anyone pay extra for the name. but when you actually sit in the Acura you say to yourself "Wow, this is nice".
Personally my wife and I both drive Honda's
We don't have Acura's over here - but the point is, you still have to decide if the differences are worth the extra cost. Is the S2 giving the person who is buying, at least a 75% better guitar or not. For someone who is perhaps not as flush with money, having to find an extra $600 for the difference may find that too much. There are some who think anything more than 1k (whether that $'s or £'s) is too much to pay for a guitar unless it really does offer significant tangible benefits over the cheaper model and better than any other guitar they could buy for 1k or less. If it has to be a PRS, then they will look at whether or not the S2 is worth the extra they have to spend but if not, then they may look at all the other options they have in the 1k or less bracket.
If you have two cars that are basically the same but one cost $8000 new and the other cost $14000 new (the same 75% more expensive) with the same engine and gearbox, same sound system, same basic body shape etc that offered the same basic functionality, you would still look to see whether or not the differences are worth the extra $6000 or whether the 'cheaper' model is good enough to get you from A to B without worrying whether the badge on the front is the right badge. I couldn't care less if the car was assembled locally with a lot of imported parts that are also on the cheaper model and a better quality tyre as standard and some more 'shiny' bits in the interior or imported as a fully assembled vehicle overseas as long as they both do the job that I am looking for - I would still be assessing whether the differences amount to $6000 worth to me or whether I could buy the cheaper model and spend a little extra to bring it up to or even surpass the more expensive model. Its all about whether or not that extra works out to be worth it and that will come down to the individual, their perception and how they value money. If you would never spend or cannot afford more than $10k on a car, then the $14000 version is too much anyway regardless of whether it does justify its extra cost. If the range of options available are not as wide as the 'cheaper' badged cars, then you have little choice - I don't see an S2 Pauls Guitar, DGT, Zach Myers or Holcomb for example. Of you only have $8000 to spend on a car and the 'Honda' doesn't meet the quality you expect, you still won't spend $14000 on the Acura, you will look to see what Ford or Nissan or Toyota have in that price range and whether or not you can get a model similar to the Honda but with better quality.
The point I was making at the start which seems to be blown out of all proportion is that if you want a Pauls Guitar, you have limited choices - the SE or Core+ range which will be 400%+ more expensive. Personally, if I was looking to buy a Pauls Guitar, I would buy a core but for some, that is well above what they would or can spend on a guitar and so they have the option of the SE. Regardless of whether that guitar is the same price as the S2 standard 24 or not, its a different guitar and I bet if PRS did make a S2 version, you would see a price of around $1800 - maybe more which may well be CE money. People will still complain that they can buy a CE or perhaps even find a 2nd hand Core Custom 24 for that amount - still not a 'Pauls' guitar that does and sounds like what a Pauls Guitar does.
The price is the price and if you prefer to buy an S2 Standard 24 for $1k, that is your choice but you are not getting a 'Pauls' guitar which is different. If you are in the market for a Custom 24, then you have more choice and again, each person will have their own perspective on value and benefits of guitars as you move up the price ladder from SE to S2 to CE to Core. If someone does think that the S2 is worth paying nearly double over an SE, then they will but others may think the difference in price isn't justified because in their opinion, they are not getting double the guitar. Even if an S2 is 20% better, in their minds, its still not that much better to warrant a 75% price jump - not when they can spend a bit more money pitting on a Tusq nut, locking tuners and branded quality PU's in the SE and still not spent as much.
For some people, $800 is a LOT of money to spend on any guitar considering what you can get - not just PRS guitars and not just 'new' guitars either. There is a LOT of competition in that $1k and under market so the SE has to compete with them (inc the quality these offer) more than compete with the S2 line. Its not always about whether the S2 is superior, its about whether or not the person buying thinks they 'better' enough to justify spending that bit more on one - if they have the budget to do so. As a person who buys Core, I have to justify whether the price premium for a 10top is worth the cost for example - in the UK that 'extra' is about the same cost of an SE Custom 24 btw - a whole guitar more expensive. If not, I can just buy a non-10top and save my money, buy another guitar or get some new gear instead of the 10-top. The principal is the same - is the more expensive options worth the extra and that will vary from person to person depending on how they value money and those extras.
If the quality of the Indonesian factory is worse than the Korean made models, then the difference becomes even more significant and that may well be significant enough to persuade someone to part with the extra money for an S2 - or maybe look at other brands and see what Ibanez, Fender, Gibson, Chapman, Schecter, Sterling Music Man etc offer around that price point. I think its more likely to push people away from PRS rather than encourage them to look at spending double and buying an S2 - of course some will but a lot of people will look to see what other guitars they can buy for the same money. In either case though, that really is individual to the person, their budget and perception of 'value' as well as their perception of those differences. There is not a one for all answer here.
