Masternode only slightly more profitable than staking? I wouldn't feel incentivized to run a masternode if that was the case.
Fluctuations in price mean I could have accumulated more DNET this last month if I'd day-traded, as opposed to holding in a masternode. If I was just staking in wallet because masternode was only slightly more profitable, that's exactly what I would have done: traded and moved coins back & forth to wallet to stake, with less long term incentive to hold.
Setting up a masternode was a hassle, updating was a hassle, paying hosting invoices a hassle, not to mention the additional cost. I am not going to be doing this for a slight and negligible profit in an uncertain market.
One of the features of this coin is it currently has a strong network 700+ masternodes and growing. I see the strength of the network being a USP in the future. Lots of coins have lots of POS participants, lots of coins don't have a 1000, maybe 2000+ masternodes. It should be a priority to encourage and achieve this.
I agree with everything you said. Masternodes shouldn't be just slightly more profitable than just having a bunch of coins staking.
I could be wrong but as far as I understand for the system determining PoS rewards will only look at how many coins are being staked and not by how many nodes so there's not really an incentive for decentralization or a checking mechanism to see just how decentralized the staking wallets are.
We want proper decentralization from PoS while typically the only people willing to stake coins are the ones who have a lot. People with a few coins rarely bother staking. But if you increase their rewards then masternodes disappear and start staking instead.
Regarding the proposition above I think there shouldn't be sharp cuts in emission (halvings) because that would mean a lot of people would sell off at each halving because each halving significantly cuts profitability on both the masternode and staking side. Every big drop would cripple the coin a bit.
I think the decrease should be much more gradual. Maybe even from PoW to PoS the transition in rewards should be much smoother (though I wouldn't be comfortable if staking would get any closer to mining profitability-wise).