I wouldn't say the Kyro 2 dominates in one aspect and performs horribly in the others. Seems like, from all the benches laying around that the Kyro, at higher resolutions it generally performs competitively with all the cards listed.
You just have to pick and choose which resolution you would like to play at. Each value card shines in one aspect, and performs poorly in another. Compromises must be made with all of the value cards listed (with the exception of the Ultra, but it is not a value card).
Take for instance the MX - The MX is horribly bandwidth crippled, runs like a pig at high resolutions with 32 bit color depth. Kyro is better suited for these situations, since bandwidth is not a problem.
Video card is largely a matter of preference. Each company provides one card aimed at one type of gamer.
3dfx (may it rest in peace) - excellent image quality, FSAA, big PCB's

, most compatible board I have ever seen.
ATi - very good image quality, solid, well rounded board (does DVD, gaming well), drivers initially sucked though (some would say they still do).
nVidia - produce the fastest video cards across the board on the plant, at the expense of image quality IMHO - which is poor when compared to the V5 and Radeon. These boards are generally marketed for people who like to benchmark the crap out of their system and never actually play their games.

The GeForce, by virtue of nVidia's marketing muscle is the de facto standard in PC gaming right now.
Looks like from all of the marketing ST has put out there, the Kyro seems to be picking up where 3dfx left off. If they are able to offer these chips at a competitive price to all of the different board manufacturers out there, some of the competition could be in trouble.
Looking at the different business models ...
3dfx - did exceptionally well as a chip manufacturer/supplier, made their own boards, died a quick death at the hands of nVidia.
ATi - have traditionally made their own boards, had phenomenal success as an PC OEM board manuf. and as SOLE OEM provider to CrApple, nVidia steals their thunder with CrApple siezing the contract, and has had 2 consecutive bad quarters. (Writing could be on the wall? - without a successful Radeon II, and III it could be)
nVidia - the dominant force in chip supply today. Don't produce their own boards and reap astounding profits. With all that IP they bought from 3dfx, and the fact they have some of their engineers - could be scary.
ST - seems to be following the OLD 3dfx model. Successful? I predict it will be because....
Board manufacturers don't like being tied to one chip maker - ST could realistically make a 3dfx-like play for the value gamer market. If the launch with Hercules is a success, momentum could be built for a future Kyro 3 launch, with a lot of branded boards, which could seriously rock the PC world.
Competition --> Innovation. Innovation is always good.