The problem with your logic is that Larry Seecamp sold his product for what he thought was a fair price, even before the introduction of the NAAs & the Kel-Tecs, and he was making them as fast as he could.
The outrageous prices were being charged in the secondary market, by people that had ordered them a year or more earlier, knowing they could make a killing as soon as they took delivery. It was even pointed out to Larry that, based on his long wait time and the prices that were being charged in the secondary market, he had underpriced his product, and he should raise prices. He thought his pricing was appropriate, and refused. The reason prices came down after the introduction of the NAAs and the Kel-Tec isn't that Larry lowered his prices, it's because the demand dropped, and you could no longer charge $600+ on the secondary market for a Seecamp. He's still selling them for what he thinks is a fair price, and he's still making as many as he can.