Bad user experience depends on the user. Personally I very much enjoy the somewhat lower price of less-beefy models of smartphones and tablets — as I'm not obsessed with taking pictures, don't play blockbuster video games on mobile, and prefer my books as text, instead of audio files. The title of the post is similar to saying e.g. "ARM CPU is bad UX", and complain that you can't mine Bitcoin effectively on ARM.
The counterargument would be that your usage patterns are the niche ones. I suppose that's an empirical question. Does anyone have any numbers either way?
If Apple were producing just the 16GB model, then usage numbers would probably be in order. As of now, things are just at their optimal state, where everyone can get what they want.