I think we are all severely overestimating the price per mm^2.If my 3770k could have been $100 cheaper owing to the much reduced diesize and correspondingly elevated yields and chips/wafer then that would have been a win.
Back of the napkin estimates would give us about 350 3770K per wafer. Assuming 80% yields gives us 280 3700K per wafer. A 300mm wafer costs about $2500. That is roughly $10 per chip.
Obviously there are a couple more factors at play here. One is the total cost of the fab, which is a pretty huge and not entirely a flat cost. The more wafers that need to be ran, the more machines need to be purchased and the bigger the fab needs to be.
AMD is actually a good indicator of how much these chips with all the overhead since they break even on good quarters. Keep in mind even the huge Bulldozer chips have some decent margins on them. Intel has no problem selling me a 3770K for $150 NIB.