Even at $300 people aren't going to rush out and buy the Touchpad. It all boils down to more bang for your buck. The reason I skipped purchasing the TP because it didn't have the basic hardware specs required for all tablets not named ipad which is HDMI out, 5MP or more front/back camera, slim design, and a SD card slot. Honestly is there really a big difference between 16gb and 32gb built-in hard drive? HP should 've forget a 32gb model and just sold a 16gb with a SD slot.
With the stated above and leaving the OS as is with no change at least TP would be competing with other tablets. Now to take it a step further netflix app should've been built-in along with doc editing. Then have the OS running as fast as the current overclock patch and price the TP at $400 and you would have a serious ipad competitor. The icing on the cake would be to launch the pre 3 at the same time (maybe priced with a discount if buying a TP pre3 bundle).
If HP were able to do the above along with the hardware bump on the 7" tablet and launch it with the Pre 3 on sprint by end of Sept I don't see why webos couldn't become a hit product.
Edit: Forgot to add working camera app and GPS.