No LTE doesn't affect people on non-LTE networks (eg all of Ireland) and isn't a deal breaker for people who mostly connect via wireless (eg all those people who are happy enough with highly restricted data plans).
If those two things contribute to the attractive price and/or design then for a big group of people these are good things. They still get a phone that works great at a low price without paying for features they can't or won't use.
This isn't the highest end phone on the market, but it puts a a lot of computer in your pocket at a price that people will be willing to pay.
What was the median price of a phone pre-iphone?
Also, I like the fact that a sealed case gives lint/dust/dirt less of a chance to invade my phone. I have a Galaxy Nexus and I have to take the back off every so often to clean the gunk out of the speaker & camera lens.
Eg, all of T-Mobile, which is the only official launch partner for the Nexus 4 in the US.
With case, you lose a lot of the sleekness.