Exactly. 3d development is WAY more expensive in terms of development than 2D games.
About PalmOS and similars ,when we made Daedalus3d (see Daedalus 3D - The labirynth) in the 2004 it was sold at 30 bucks! And noone was complaining... and here they was 40 euros at the time.
Now with 10 dollars (6 euro) in Italy you can barely buy a beer ...