Not unlikely, but nigh impossible. Unless they have mates in the manufacturing industry who'll cut them a crazy deal, they'll never be able to source at as low prices as the big consoles companies. As a hardware company they have to make money on the box sold, so cannot sell at near zero or even negative margins as the console companies do (this is why MS makes XBox, because they couldn't get any chumps to make a DX console for them because there was no money in the hardware).
If this was an official Valve box, it may have had a tiny, tiny chance, but as it's just a PC company selling a design, it has zero competitive advantages with the console companies when it comes to manufacturing costs. At least, not at comparable performance. If they stuck with off-cut hardware, the naffy low-grade binned elements that no-one else wants, they could possible cobble something together real cheap, but performance would be lacking.
MSFT is in the grey or making profits at 499$, Sony seems to be spending 460$ on the PS3 hardware. It seems indeed tough to make something significantly better for 500$. I don't think either MSFT or Sony are counting for R&D as it was suspected for Nintendo when they claimed to lose money on the WiiU.
There are cuts that should be made, Steam box are unlikely to have a optical drive, and my belief is that a system designed to play games doesn't need 8GB of memory. 4GB would be fine for quite a while and 6GB would be future proofing.
Now I don't think that it would enough, the main issue right now from my pov is the lack of proper APU. Going with a discrete CPU and GPU is a severe overhead, companies are likely to take margin on both, it makes for a more complex mobo, it may operate at a performance deficit vs an APU packing mostly the same power, it is likely to be wasteful wrt to RAM.
Then there is the controller, I think it is going to be costly (because of the screen).
So I agree with you matching consoles is night impossible. They have 2 options high end and low end. I think that nowadays hardware is still lacking in the low end and looking at the controller it seems to me that they may be aiming at high end.
Overall if the controller is any hint about their positioning, I'm not sure I agree with where they are heading. The high end will prove tough to reach imo, people will have few intensive to replace their Windows PC, or even to deal with dual boot.
So I'm wary at the moment as I believe that going with a high end (pretty expansive) set-up would be a mistake, actually I think they would be better off waiting a tad and releasing something both competitive and affordable, it can't be done now though it should be doable soon, and there is the controller I expect it to spice up the bill unnecessarily aka the screen should not have made it into the design (it should have an adverse effect on price, how long the controller run on battery, the battery size and its costs, etc.).
