I strongly suspect that EOS-M sales have been disappointing
As there is no other plausible explanation for such a price cut I agree.
Interesting though how much Canon has learned from this i.e. how much crippled the next M will be.
What concerns the dual pixel system I take it for granted for the next M:
1) new technology is what helps to sell products
2) it is not really such a big difference, still far cry from PDAF so it doesn't add extra competition
3) most probably the technology has even bigger potential in the next iteration so the 70D version of this technology will not last too long
All that said I still don't have much interest in Canon cameras, there are much more interesting alternatives for my preferences. Only sound innovation could change that.