Paying ninety-nine dollars for a tablet is not "magic". As has been said, the only justification for HP to sell their TouchPad at that price is to clear their inventory; they could have set the price at $200 and $250, the stock would have cleared almost just as quickly.
If any tablet price is deemed "magic", it'd be selling the device at a break-even price. That's figuring in cost of parts, labor, advertising, etc.; they don't make money off of it, but they lose absolutely nothing. Then you sell applications for the device at a profitable price, accessories at a profitable price, extended warranties, repairs, etc.
In the end, you make money because more people bought the device (than they would have if it was sold at a profitable price) so you have more people buying aftermarket goods for it. I'm not necessarily saying they make MORE money than if they would have sold the tablet at a profitable price...
There's a term for this; something along the lines of a "razor" something device... Sell the product at a loss, make money off of supporting the device. Like with game consoles.
How much HP DIDN'T support and push the TouchPad like they should have really reminds me of the ZuneHD. It was quite superior to its competitor (at the time, Apple's third generation iPod touch) in many places, but Microsoft supported the device nowhere near how much they should have. It's almost, to me, as if they didn't care about the device. To me, Zune is dead (as hardware). Even though HP's webOS devices will no longer be supported/produced, I hope the OS will live on strongly on other hardware. It is a nice, fresh operating system.
If only the ZuneHD's UI could live on... WP7 just isn't the same.