Let's Play UpMarket • DownMarket...The audio game

You have an imaginary audio budget of your own choosing.

Will you choose the upmarket component of a modestly priced company, or the downmarket product from an ultra expensive vendor?

Examples from the speaker category.

Upmarket: Vandersteen Seven, Zu Dominance. Both statement products from companies known for selling reasonably priced products.

Downmarket: YT Carmel, Magico V2. Entry level products from upper echelon firms.

Which will be your choice and why?

The trickle down technology from the bleeding edge outfit or the value oriented firm freed from the constraints of cost?

Let's talk sonics and value, rather than resale value.
I would change that to long established company with a lot of R&D available, to startup with new ideas.
But, to be closer to the OP question, hard to say. Aside from my bias toward long established companies, i would say in defense of the hi end cheaper product, that it would contain the better stuff in the (non political version) of trickle down. That it can have great proprietary stuff in it.
As for the mid fi's company best product, the may be making a statement product, and usually those are a good value. IE they are not so much trying to make money, as build the brand.
Either way I think it depends far more on the individual product, rather than so loose a concept.
As for myself, I bought a Forte' 4a years ago. It was a lower priced high end company's mid priced line (threshold). It was a wonderful amp.
Then I bought a Sony top of the line preamp and it was a chunk of Camel-spit.
So from experience, i would tend to choose the lower priced product of a high end company.
you have asked a rhetorical question.

i would attempt to audition a product from each.

i think the issues you raise could be irrelevant to a purchase decision because,i might not like the products produced by either company, regardless of the prices of their top models.

its an interesting academic and philosophical question.

elizabeth, you are funnier than jay leno.
I think that without any additional information I'd choose to purchase a downmarket product from an expensive vendor. Because so much of the price is based on the market rather than material costs there's a significant change that the cheaper products will share a lot of the more expensive technology and components from the more expensive models.

I have Focal 836v speakers that are the flagship of the budget Chorus series. I really like the idea that a single company has products ranging from about $500 for a pair of 705v bookshelf speakers all the way to the $180k Grande Utopia EM speakers.

My father-in-law has the 706v speakers that share the same tweeter with my 836v. I told him that he's either got a $600 pair of speakers with a $3,000 tweeter or I have a $3,000 pair of speakers with a $600 tweeter. It's a perfect example of a component being shared providing excellent value to the lower end speakers.

I think a company, like Focal, works very hard to maintain the high end name even with the budget products in a way that isn't as important for a low/mid fi company to do when building their name.

There's less risk for the company that producing their first flagship product because it will have less of an impact on the overall opinion of their compnany than if a high end company started selling "junk." The audiosnobs would could easily lose respect for the name and stop purchasing the expensive gear while the average consumer won't care that much about a flagship product (most will think it's an improvement anyways) and will continue as they were before.
What is ignored is what product has the best circuit design, for in the end that is what you hear. Most time the design is the same, whether up or down. The execution in components is often what decides price. I am partial to finding the best design as most often it is that which creates a better sound. I find interesting the business model of Cayin, which takes the classics designs and executes them with current state of the art components.
Your question has made me realize that I have a bias in favor of the "downmarket" products of higher end manufacturers. That is reflected in most of the major components of my system - preamp, amp, speakers.

I would like to say that this preference is the result of conscious deliberation and judicious reasoning. But it probably just means that higher end manufacturers have more persuasive marketing. :-(

I have noticed that, as I become more experienced as an audiophile, I am increasingly drawn to products from companies with a lead designer whose design philosophy I believe in, e.g., Pass, Merlin, Atma-sphere, etc.

It is an interesting question in that the usual response would normally be "you have to hear the items in question and decide for yourself." However I too fall on the entry or less expensive model of the upscale manufacturer. I agree with the idea that they have t use some trickle down technology if not production methods and personel who do the work. I too own JM lab Electras which at the time supposedly used the same drivers as the Utopias. They never mention the cross overs and certainly do make you aware of cabinet design differences. I bought used Cardas and the entry level Jena lab speaker cable, and again following the pattern I bough Carey audio's sub brand ultra low price AES brand preamp. it has been a magical combination.
The amps for the JMs were bought for other considerations. ( I knew the distributor)
I did buy the best Jadis integrated I could afford, but that also was really based on one that I had heard at some length. I use it to power Entry level VSA VR2s. I love them but there are better speakers for that amp.
I too would generally prefer next to the bottom model from more upscale company and in some cases even the least expensive model. For example, I would choose Rowland integrated over any Creek or NAD or most Naims; or any Nottingham turntable over any Denon and most or all Pro-Jects. However, for digital I could be happy with $500-$700 Marantz DVD player new, and would not spend much on digital player anyway, under $1k for sure.
Ok after round one, we have some great responses and examples.

Round 2 - Any more specific examples people can chime in with would be great.

I may be having some fun with the format of this thread, but who knows, if it gets dozens of responses and examples, maybe some truths or patterns may become apparent that I or anyone else had not anticipated.
Thought I'd revive my old thread and see if new observations come to light, especially as companies like magico have introduced some fantastic lower priced gear. 
I will say (a more budget conscious line which I sell) has created some fantastic higher end products that are stunning, namely the BHK line of electronics from Ps audio.  

Saw this post and was curious.  Was nice to read the first two replies by 2 people who both are missed.
We ,audiophiles, need the ultra high-end and state -of-the-art (SOTA) for its trickle down effect of technology.  Happy Listening!
well, I have at least 2 mid-range items from long established companies, each with a lot of R&D available - and they are both located in Mini-Soda