I am not happy about the degrading of the entry Mac Mini either, but I understand the marketing reasoning for it. We are using a four year old Mac Mini Server in my office.
For an entry Mac, the new $499 1.44 GHz Mac Mini is not bad. . . but for our purposes, it will not do the job we need. We have to step to the next level up. . . either the $699 2.6GHz Mac mini dual-core Intel Core i5 with either 8GB or 16GB memory and a 1TB hard drive, or the $999 2.8GHz dual-core Intel i5 upgradable to a 3.0 dual-core Intel i7, also with either 8GB or 16GB of 1600MHz LPDDR3 memory and a 1TB Fusion Drive. . . or upgradable to a 2TB Fusion Drive. These Mac Minis are fast. Either of those can run OS X Server and the latter price is what we paid for our Mac Mini Server four years ago.
You think that you need four cores for music software? I don't think you do. I frankly doubt much of the music software out there even is multi-core aware. What you need is excellent multitasking. . . which the two upper model Mac Mini's can supply. .
And on and on. Look it up :)
I won't work without a minimum i7 4 core with hyperthreading and at least 16 gb ram. Especially when using VSTi's as is common.