As I understand, the 6.8mm projectile was chosen by the military because of their requirement to defeat advanced level IV body armor "at distance" (600+ yds), so they had a B.Cs and a certain bullet kinetic energy in mind.
As there is no difference between 6.5 and 6.8, the Army just pulled that out of their hat.
They designed the round (Army, in house) to meet the specs and I am good with that. There is nothign magic about 6.8 that 6.5 is not.
A Hornady or Sierra could have done the same with 6.5 or 6.8 and it would have done just as well. 6.5 maybe a smidge less drop (6 to 9 feet as it is out at 1000 meter is a huge deal).
The whole process is far better done than the M-16 (which could not have been more wrong)
That said, it is also a work in progress. Barrel changes on the M5 are easy, so they may well go with a shorter barrel, they may mix and match or they may setup for a theater. There are 8 inch barrel versions.
In Jungle you do not need 1000 meters, but you don't get that without a cost, you can't get any accuracy past 300 with an M4.
The M5 has a folding stock and you can go with shorter barrels (dismounts out of Bradly)
So this is also a doctrine testing period as well as hardware.
The Fire Optic seems bulky for a urban combat, they say not. It does not mean you have to use that FO either. You could issue ACOG or Eotech for urban combat.
And finally in this case, its not cost but capability driving the train.
USMC is also experiment doctrine wise with the M-27, dropping a SAW from a fire team.
Is an accurate M-27 better than an inaccurate SAW? Does many fires make up for a SAW suppression (and why could not a SAW be made to work with magazines? Forget which but someone did it and made it work both ways (Israelis I think )
Clearly the M5 with the Fire Optic allows a grunt to put the cross on at 600 meters and hit. Further possible for a steady fire position (and you can be steady at 1000 meters)
The Army is going with the M250 machine gun in place of a SAW type. I don't know if its right or not and it may well be USMC is more right for what they plan (though its hard to sort out the USMC right now, I don't believe in their Island Doctrine).