GPU cost = cost of wafer / GPUs used from this wafer. All GPUs will cost the same no matter if they are salvage parts or not.
Just as an example. Lets assume a wafer costs 50000 USD.
Chip A yields 100 working GPUs, no salvage chips used. 500 USD per chip.
Chip A yields 100 working GPUs, 400 salvage chips used (Chip B). 100 USD per chip.
Chip A yields 100 working GPUs, 400 salvage chips (Chip B), and an addition 500 salvage chips (Chip B). 50 USD per chip.
Salvage chips decrease the cost of chips. So if no salvage chips are used that full enabled chip in this example would cost a whopping 500 USD each. By the time you get down to a 3rd salvage SKU, it's now 450 USD cheaper. Or adding a 2nd salvage SKU (3rd chip SKU) it's made the chips 50 USD cheaper than only have one salvage SKU.
And with all those examples. Non-used chips still = 0 USD. And unused wafer space = 0 USD. Cost per chip will be purely based on wafer cost divided by working chips. So if you end up with only 1 working chip, you just made a chip that cost you 50000 USD.
So, in the end. Smaller chip = better use of available area on a circular wafer = better cost per mm squared even if yields were 100% for a smaller chip and a larger chip. Add in the fact that larger chips yield worse given equal levels of redundancy, etc. and smaller chips have a far smaller cost per mm squared.
Wafer costs for different customers can be different because it's up to TSMC to decide the pricing in each case. What's even more important is that there can be different pricing schemes for different customers and it's not entirely true that a GPU cost made at TSMC is almost purely based on yields and die sizes. TSMC has to make some money too while making sure that they won't loose their customers to competition. Saying that GPU cost is based solely on yields and die sizes is like saying that oil costs are based solely on cost of extraction and transportation.
Sure, company A might negotiate a cost of say 4500 USD per wafer, while company B might only manage to negotiate a cost of 4550 USD per wafer. It's not going to overly affect the cost per mm squared of a large versus small chip. And perhaps one company will pay less for less validation, but does a company really want to risk the potential of massive levels of failure and public recall of product?
Your oil example is particularly bad. As I explicitly mentioned that there's addition costs once you get to board manufacturing and packaging. IE - refining and other costs associated with transforming Oil to petrol, or diesel, or plastic, or lubricants, or whatever. But that just makes your analogy even worse. As refining Oil into petrol inevitably leads to additional saleable products made from the byproducts. Although that could be considered similar to salvage chips, in which case it bolsters my example even more.
Regards,
SB