Thanks for reminding me of the Teensy. I looked at it way back when I was looking for a small-footprint Arduino, but went with the Oak Micros om328p instead. The Teensy never occurred to me as a replacement for the Arduino Mega.
I started this thread because of chessplayer's work in another thread. (That software needs the larger SRAM, etc. more than the extra I/O.) I should have started off by phrasing my question "Why is the Arduino Mega double the price of a Duemilanove?" I thought the fixed development costs of PCB design and layout would have been equivalent to the other Arduinos, so wouldn't have entered into the equation for me, leaving component costs to be the difference.
I have absolutely no problem supporting development work, that's where the value comes in.