It would be cheaper, but it's PART OF THE SYSTEM. So saying you're paying for it is ridiculous. That's what it costs. It'd be cheaper without a control pad, or HDMI lead, or Blu-Ray drive too. But they're also part of the system and that's what it costs.
What MS could do is lower the cost and make money over a longer time from software sales, but they wouldn't do it by removing a part of the system.
So it is essential to have kinect to actually use the xbox? I thought people had been talking about being able to disable it.