Yeah it’s the studio display that makes the entry level 27 inch impossible to recreate. 1600 - 2000 dollars got you a respectable iMac 27. With a studio display and a Mac studio, not so much.
The <~$2000 iMac with 5k screen was always the closest thing Apple offered to a bargain. With 5k completely failing to take off in the PC world, and the 5k iMac not selling in the same sorts of numbers as laptops, I guess Apple just can’t sell the large volume needed to maintain those prices, let alone upgrade to miniLED or suchlike. I suspect that Apple were already taking a reduced profit margin on those - compensated by the higher end models (which were priced closer to the Studio combos).
Thing is, the market for the 5k iMac was being eroded in multiple ways:
1. demand for desktops is probable falling in relation to laptops across the industry, and Apple Silicon is a game-changer there - desktop Macs used to have the higher-TDP Intel processors and GPUs giving them a performance advantage over MacBook Pros, now everything is using the same silicon and has much the same performance - if you’ve got
any need for portability you’ll probably be best off with a MacBook Pro.
2. The 24” iMac is more powerful and has a bigger, better screen than the old 23.5” one, and will certainly “steal” some potential 5k customers.
3. Lots of people liked 5k iMacs - but a lot of other people would have preferred an affordable modular system. The Intel Mini was knobbled by a poor GPU and the Mac Pro out of most people’s league so they ended up buying a 5k iMac. The Mac Studio - and even the M1 Mini - are a far more attractive prospect and would have decimated (at least in the pedantic 10% sense, probably worse) potential iMac sales.
Other displays for your Mini/studio are available at lower prices - there are some workflows for which 5k is an advantage, but for many, 4K offers a decent compromise for a lot less money and a far wider choice of products. Some people are even getting “low res” 1440p displays because it turns out they are optimal for some jobs.
I‘m using a pair of “4K+” 3:2 displays which, together, came to less than even the LG 5k option, let alone the Studio. The combo is actually working better than 5k for me. YMMV.