Anyway, thank you both, I'll need to do some more reading/investigating on this. I'll check back here tomorrow whether someone did find that post

Agreed.

QFT!
The marginal cost decreases with the block reward proportionate to the mining fee.
So while the n vs n+1 will never be equivalent, they should be expected to increasingly approach the risk/reward for orphaning.
This should then also be expected to increase the desirability of including the n+1 transaction in the block.

At some future time the transaction fees may be more than the block rewards, as block sizes increase and the block rewards decrease.
This future time will likely be after a much longer term bitcoin price stability than anything in its history.  This may well be for younger people than I to observe.  
So far, bitcoin valuation has increased so much faster than block rewards decrease, and so transaction fees have decreased faster than block rewards.  We should not expect this to be true forever, just for a long time to come, and also for block sizes to increment over time.

tl;dr The protocol works very well and these considerations are baked in.  Bitcoin is quite secure in this regard.

what i don't get is why isn't Gavin moving to increase block size now as opposed to when we're in the middle of the next bubble or two when tx size will have surely increased along with price and his back is against the wall?  i'm not advocating this, just asking the question.

he's already shown a reticence to make changes to the protocol.  not that i'm complaining, mind you, as i think he's done a stellar job as lead dev.  but at that point, it may be such a political hot potato that nothing may get done at all.  

i don't see that ever happening as long as Gavin remains lead dev.  there's no one even close to him that has the political capital, trust, or good will he has generated.

We'll see.

The reference client has already lost the technical lead to btcd, and their dev team is orders of magnitude more functional than Bitcoin Core's.

In addition, he doesn't have as much goodwill as you think. I'm not the only person who's noticed that there has been no substantial development in the reference client for about two years.

Seems like this Gold vs. BTC saga isn't gonna end soon. 

they do matter when some of the largest holders of bitcoin come from that segment of the community.

When historians look back they might well conclude that the 1MB limit resolution was Bitcoin's "betamax moment", the most important decision point determining its ultimate fate.

coinmarketcap.com is interesting because it gives a market assessment of Bitcoin's future prospects.

Right now the total cryptocurrency market cap is $8,197,074,397 and Bitcoin's is $7,678,842,953 or 93.68%
(higher if MSC and XCP and other BTC-based alts are included).

So, the cryptocurrency market is effectively pricing a >93% probability of Bitcoin dominating this new asset class - long term. An asset class of such importance that many crypto investors consider could make all fiat obsolete and perhaps even demonetize precious metals as well.

If the 1MB limit is not handled properly, in good time, and is allowed to seriously disrupt organic growth, then that percentage will fall significantly. Perhaps even causing an irrecoverable erosion in the first-mover status, opening the window for alts like NXT and XMR.

This is the stakes in play.

Bitcoin can not disrupt fiat currencies unless it's a network that everyone on the planet is actually capable of transacting on.

Pulling out all the FUD/propaganda stops to keep the transaction throughput rate capped is the best possible strategy the defenders of he legacy system could employ to save themselves.

If they can force most transactions off chain, into the waiting arms of Coinbase and Circle, then most of the benefits of Bitcoin will remain inaccessible to most of the world's population.

Given the stakes involved, I don't trust Gavin to be capable of making good decisions even if he wanted to. A single point of control is a single target for blackmail and extortion.

What you're talking about are  symptoms of a sub-optimal network layer.

The fact that the P2P network suffers from a tragedy of the commons effect because there is no price discovery for bandwidth or storage is nothing inherent to Bitcoin - it's inherent to the current design of the reference client.

If people who don't want Bitcoin to succeed can stop that problem from ever being fixed in the reference client, they can point to the tragedy of the commons problem as an example of why never to raise the transaction rate, forever.

Of course, that strategy only works when a single codebase has a monolopy on the implementation of the protocol.