I put some more thought into this. As the OP said, this is a common question on the gun boards and I've never really thought it through.
Here are my thoughts:
All firearms have certain things in common. I know this is the Handgun board, but let's use bolt action rifles as our example for a moment. All of them have a barrel, a trigger group, an action, and a stock. Let's assume that a manufacturer can build an accurate enough barrel, on a functional action, with a decent trigger group for $150. Then you slap it in an injection molded stock and you have the Savage Axis for $300. It is a "good gun for the money". It will shoot fine, and it will load fine (usually). And for some, that's enough.
So, what's the difference between that $250 Savage and a $1000 Browning X Bolt, for example? They both have triggers, they're both available in stainless steel with an artificial stock, they both shoot well enough, they both take a detachable mag... so what's different? I'll tell you:
- The Browning has a much NICER stock (more stiff, fits the action better, is finished better, doesn't have plastic mold lines through the middle of it, isn't hollow and loud when tapped, etc).
- The trigger on the Browning doesn't have that AWFUL safety blade.
- The action is much slimmer, lighter, and machined better.
- The cycling action of the bolt much more smooth. It doesn't rock, rattle, and scrape.
- The finish of the steel is better on the whole gun (more polished, more smooth).
- The gun is balanced better.
- Etc.
Does the Browning kill game any more effectively? In most cases, probably not. But, is the user experience better in the process? Certainly yes.
This is an example of the 80/20 principle, which shows up in almost every area of life. You can get 80% of the performance with 20% of the money... but beyond that point, if you want to get better, the proportion of money/effort necessary for performance gains goes up dramatically.
You may agree or disagree on my comparison of those two particular firearms, but I think the principle is sound.
Now, let's get back to handguns. The principle still stands. Why do you think MOST casual shooters are fine with their stock, unmodified, relatively inexpensive Glocks, M&Ps, Taurus (yuck), etc while competition shooters spend thousands of dollars on heavily-modified STI, CZ, Tanfoglio, etc?
Because most folks are happy to only get 80% of the performance by spending 20% of the money.
That's the principle. So, when someone asks, "Which is the best gun for the money?" the question really is, "What sort of experience are you looking for?" And that is SUPER subjective.
I think we'd all agree that if someone is looking for a home defense gun, the answer to "what's the best gun for the money" IS NOT a $3000 STI race gun. Would that work? Sure would, but a $500 Glock 19 would work just about as well, for about 17% of the cost.
In conclusion, when someone asks me the "best for the money" question, I try to think, "Which gun that does the job they need done has the highest ratio of user experience to cost?" And that's my answer.