For example, the shuffle seemed more aimed at people who wanted something easy and light to clip on while exercising.
The nano seemed to cross-over slightly with that market, and also attract people who wanted something tiny but full-featured. (I.e., it was the size that differentiated it, not price.)
I don't think many people thought "Oh, I'll get a shuffle because I can't afford a regular iPod."
The fact that Apple continues to offer the previous years' iPhones is actually kind of unusual with regards to the structure of their past product lines. It's how they are trying to cater to different price brackets rather than use-cases.