I do think that was indeed their thinking and strategy: Push the OS to the affordable market and hope that it would spread. I think that strategy didn't work out too well, hindsight looking of course. I guess the flipside other approach was to target the high end flagship market and set a standard for which the public could and would see what Microsoft and Windows in particular could do, even though not many could afford or would even want to buy it. But it could, and I'd say, would have, announced to the public, "this is Windows, this is all that we can do. We can compete with your beloved Apples and Samsungs, and we can also do so much more those others can't". Hindsight again is always 20/20 and it's easy to say what they should have or could have done. I would say too that some things you can't always predict and plan for. There are things that catch and things that don't. I'm just glad MS took the latter approach when it came to tablets (and PCs) and was able to produce the Surface/Surface Pro line. The Surface was very much a "push the boundary" type of device targeted for higher end. Off of that, it can now produce product for the cheaper market for those that want to buy something they can afford but still have something that looks and feels like what the rich folks have.
Microsoft also is pushing not only devices but ecosystem. Goal here is to have people buy into their software offerings and their ecosystem even if it means having that software on rival companies' platform, in hopes that people will like it, use it, and then feel like they can't go on without it. That's pretty powerful if it all pans out.