Remember also that speakers (and thus also headphones and earphones) are electromechanical devices, where there are real differences from model to model. It's not like wire, which (at audio frequencies) behaves very consistently. Get the geometry of a speaker/headphone/earphone enclosure even slightly wrong and you have resonances, weird frequency response, etc.
That's true and in ear headphones should sound better in theory because there's less room for the acoustics to be a problem and making them smaller, means that any resonances should be higher up, possible in the ultrasonic range.
That could be, in theory at least. IMHO (which is just based on experience, not a scientifically valid survey), it seems that in practice, it's a lot harder to do in small buds than in big earbuds and in headphones. It'd be interesting to know what high-end earphone manufacturers, as well as hearing-aid makers, do that make theirs so much clearer than cheaper models.
For sure, you don't need to spend $20K on a pair to get good sound. But unlike $2 vs $200 cable, where there's unlikely to be any measurable (never mind audible) difference in performance, the difference in performance between a $2 and $200 speaker/headphone/earphone will be enormous. Between $200 and $500, much smaller. It goes into quickly diminishing returns.
That's interesting. I wonder where the point beyond not being able to tell the difference is? The trouble is, it's not something which is easy to verify, because there are other factors such as brand name, aesthetics and comfort, which are all important and everyone has their own preference. For example I place comfort above everything else, hence no in ear phones, but other people will choose something else.
For sure, the point where one can no longer notice a difference isn't the same for everyone, and you can also learn how to be a more critical listener. (Which is a blessing and a curse, I'm sure!!!)
As for comfort: Again, don't write off in-ear earbuds. While it is critical to find a pair that fits you well, with the right size and shape tips, they can be extremely comfortable. I find good earbuds to be more comfortable than
any headphones. These Etymotics, despite needing to be inserted rather deep*, are extremely comfortable for extended wear once the tips are broken in. Cheap in-ear earbuds often have very fat stems (often around 5-6mm) to which the rubber attaches, making them not very pliable, and limiting the smallest size. Expensive ones, in contrast, use extremely thin stems (around 2-3mm) that allow for far greater comfort, and more flexibility in rubber/foam tip shapes.
I can't say for sure, but my hunch is that your experience with in-ear earbuds is only with very cheap ones, which are indeed rather dreadful. They have as much in common with high quality in-ear earbuds as a frozen pizza baguette has with a fresh brick-oven pizza in Naples: the name and very roughly same ingredients, and that's it.
*One German review said the sound wasn't satisfactory until they were seated properly, "deep enough to tickle your nostrils from behind!"