I understand everyone won't agree, but hear me out:
One of the key problems with electric cars is range anxiety of ICE owners. The moment they smell "out of power"-issues, many people will run for their life.
The purpose of the Model S is two-fold: to finance Tesla (make it break-even) and establish a desirable product, that people can aspire to. That is the point of starting with the luxury high-end: to create the "ideal product", which not everyone can afford, but everyone wants. Then you let the technology and price trickle down until you reach the mass market price point. If you move down in price too quickly or too low, people will instead see it as diminishing your brand. It's well-known that some luxury products sell better when prices are raised - a bit counter-intuitive, but not if you look at the real purpose of buying a luxury car.
So my case against the 40kwH is that
1) It risks creating a product that will play into the hands of consumers' range anxiety and competitors' trash-talking, by having too low a range and no super-charging. It's a bit comparable to making a slow Ferrari, or a plastic iPhone.
2) It lowers the price point of Tesla cars, diminishing brand "exclusivity". Let's face it - people don't just buy BMWs, Lexuses, Porsches etc because they're nice cars, they buy them because not everyone else drives them.
3) It probably cannibalizes on 60kwH sales - if there were no 40kwH option, most reservation holders would move up (and probably afterwards think they made the right choice) and the others would wait until finances improved or Tesla released a lower-priced model, i.e. the "GenIII".
4) It adds to production complexity.
I'm not trying to be elitist here - if there's no 40 kwH option, I won't afford a Model S. But maybe I shouldn't.
In my perspective, Tesla should launch work on making a higher-performance option in 2013, not a lower-performance. Make an absurdly over-powered 100 kwH monster and price it at a premium, or launch an updated Roadster (as long as neither stops them from working on the Model X or GenIII).