I started on a 521. For the price I figured, "Why not try Windows Phone?" I was on the most current Nexus at the time (N4) which was not budget. So I wasn't part of the pie chart in terms of OS or price point. Lumia 521 lured me in and the OS hooked me. I moved onto a 925 quite rapidly.
In the last two years I've had a 521, 925, 1520 (current daily), 520 x2, BLU Win HD, 928, 830 and BLU Win HD LTE (current backup). There are many similar stories around the board. Also many users around the board express how they have a 5xx as that is what they can afford. They keep them running as long as they can because they have to. At the value pricing of the 5xx series there is no such thing as iPhone unless it has fallen off the support cycle and on Android I'd dare say the experience is pretty horrible at that low a price level.
Windows Phone users might be rare in the overall, that does not mean that treating it as an elitist market and only offering high dollar phones would work any better. There needs to be a gateway to lure users in who would normally drift to Android because iPhone is priced beyond their reach and inexpensive models let the curious with disposable income try before they go all-in.