I feel like there are dimishing returns and also elistism where a person who normally buys expensive stuff would be perfectly fine with how a 500 dollar headphone sounded if they did a blind test and didn't know the price.
There is a lot of confirmation bias and also a brain bias when spending money. I've heard great audio at 300 that rivals 2000+ because I listen with my ears, not my eyes or bank. Plenty of people claim (with no measurable proof) that something is better than something else.
This falls under the technical performance (measurable performance) vs. prefered sound signature ( subjective performance).
I agree, I have had many cheap guitars and expensive, and the difference, at least in terms of playability and sound, isn't that much.