Why, do they give any reason? If they say piracy i say BS, since most piracy is downloading not sharing physical media. That extra storage is essential. Maybe i'll have to look for a n7 clone that has those features.
They sell 32gb versions for $50 more then 16gb versions. The up in ram fron 16 to 32 cost Google about $8 in build cost and they sell if for $50 more. If they put a micro sd slot in the Nexus 7 16gb you could buy a 16gb micro sd card for $13. http://slickdeals.net/f/5914286-New-Samsung-16GB-Micro-SD-SDHC-Memory-Card-Class-10-w-MicroSD-Adapter-Case-for-12-99-free-shipping
Any other questions?