By having separate lines, Apple can sell the 12 for cheaper than the 12 Pro, and those who are willing to pay for the 12 Pro camera can do so. Don’t see any muddying here.
It’s not ‘yeah, the new iPhone is great! You gotta have it.’ It’s “so what do you want to do mostly?” — no one knows.
That is what I believe the 90s curse really means — your evangelists are no longer as effective because they give potential customers an overwhelming amount of information that slows down, and sometimes prevents, a sale.
—- Your point is exactly right - Apple has decided to harvest the demand curve over making something undeniably great.
Edit: let me clarify, watch and homepod mini are currently in the category of 'just get it' products. This is only a critique of the iPhone line.
(I would argue it's very simple: "Get the iPhone 12 in the size and colour you like", the Pro models are an up-sale for the people who want different screen-size or slightly better cameras)
[Edit] Apple is specifically doing this frayed product line to harvest the demand curve, lower supply costs, and amortize R&D across a large unit base... they are playing to the current low interest rate world in this product line. It's an intentional business choice, not a product choice.
However I still believe it’s a bit more aggressive than necessary.