Honest question but do you have any source for this or is it primarily your personal experience?
In my experience land and experience has been leveraged to help get a foot in the door sooner than later, it was never anything more than that. If we had the ability to walk into a shop and start with 100% of the clients environment we'd have done that but the problem was typically tied to the customer not being ready to rollout from 0-100 overnight. For us the best approach was to start small and work with the customer on gradually rolling out as they were comfortable.
Regarding your other point:
> How about neither of these - how about selling solutions that you honestly believe are right-sized, being transparent about the sizing/requirements assumptions you have made, and then being flexible contractually if reality turns out different? This is how you actually build trust and consumer satisfaction, not by deliberately underquoting.
I'm in complete agreement, this is the best case scenario and is certainly the best way to build long-term trust and relationships but universally it doesn't happen or when it does it's not transparent. The customer really has to push to make this happen only leading to anxiety, relationship damage, etc.