I don't think the Big Dummy and adding a regular Free Radical kit to a mtn bike are the same thing. The BD will be a whole lot stiffer - not to mention the many design tweaks incorporated to make it a better hauler.

You are right that you don't need a BD, but the same logic can apply to any bike. You can get around most cities with a pair of shoes, a backpack and a bus pass.

As for the cost I can't confirm or deny that it is over priced since I don't have Surly's financial data, but consider the additional design efforts, material/construction costs as well as shipping such a large frame - then factor in the very small numbers these frames will be made in. I wouldn't be surprised if Surly makes less net profit on one of these frames than they do on a LHT.