Well, thanks a lot for your thoughts/insight on the subject. We discussed/thought/slept on it at length and still think the price is right.

The biggest single piece that convinces us is that the people we're aiming at are hobbyists. They are already using free tools (often wordpress + plugins, or similar) and only pay PayPal fees. We want them to stop screwing around setting up custom blogs and password protecting them (posts are 'lessons', upload videos to vimeo and password protect those too, etc) and use something end-to-end/hosted instead, for which they pay a small cut of their revenue.

As I mentioned earlier it's the same fee structure as kickstarter, and it seems to work well for them.