Where is gets annoying is that most other RAW converters don't ask you 349 US$ uprade fee to support a new camera type... most of them actually do it for free for a long period of time.
The major upgrade to Photoshop happens on average, every 18 months. During the time that the current version is well, current, the updates are free. For Camera Raw 3 in Photoshop CS2, that was 7 times (3.7 was the last update), for Camera Ra 4 it will have been 6 updates (CR 4.6 will be the last update for CS3-which has been released as an RC but will be released as a final GM even AFTER Photoshop CS4 has been announced).
But the point where you loose me here in your logic is that you are equating a Camera Raw upgrade along with a Photoshop and Bridge upgrade for whatever the upgrade cost is to a very limited functionality raw converter by some other company. What other raw converter comes with the functionality of Photoshop? By your logic, you are paying for Camera Raw and getting the Photoshop and Bridge update for free...you see the problem with that logic?
I also question your 349 US$ uprade fee...that's for Photoshop Extended...which has a lot of interesting stuff for mostly non-photographers. So, comparing the standard upgrade for the regular version (which in the US is $199, not $349) it makes the comparison of Camera Raw/Photoshop/Bridge to any other raw processor only software even more, uh, ludicrous. If you average out $199 for 18 months, that's just about $11/month. Heck, I spend more than that on wines by the glass sometimes...sure, for some people who don't do this for a living, that might be considered a high ticket luxury, but then there's always Photoshop Elements (which really fulfills the needs of many people who seem to convince themselves they really need Photoshop).
Now, I won't get into the whole US VS the Rest Of The World pricing...I think Adobe is wrong and that's way above my pay grade anyway...
But really, for people to complain so loudly and claim that Adobe is "forcing" them to upgrade their version of Photoshop just to get new camera support is pretty darn dismissive of the value of Photoshop.
I was around for the first version of Camera Raw (version 1.0 that would work in Photoshop 7) that Adobe sold for $99. Should Adobe have continued to sell Camera Raw as a separate product? That way the development would be un-linked to a version of Photoshop. But I'll tell ya that the nature of Camera Raw would have been considerably different than it is now if that had come to pass. Users really are a lot better off the way it is now than the way it would have been if Camera Raw was a separate product for sale.
Again, I'll point out the dichotomy that seems to encourage photographers to value software less than hardware. You really shouldn't. I can think of no time in the history of photography where one's "originals" have continued to improve so much AFTER they were shot as with raw digital photography. And to be quibbling over a couple hundred bucks every year and a half or two just seems pretty to me.