They're probably selling 20-30 times as many iPod Classics/year as they ever did xserves, even at their peak. The xserve also didn't do anything to act as a draw toward other Apple products, and required frequent revisions to keep up. I bet ongoing iPod Classic R&D budget is statistical noise.
I'm not making a close analogy and I'm not saying they should shut it down.
I'm just saying Apple will know when the classic isn't worth the time/energy/shelf space and I wouldn't be shocked if they announced this is the case in weeks rather then years.
And I guess I'm making a wild guess as to how they might keep an HDD based idevice relevant although I don't think that's particularly likely either.
