I remember seeing multiple tests done several years ago comparing several top brands including K&N, AC delco, Fram etc.
Brands like K&N don't offer anything to justify the price. Fram was absolute garbage, and AC Delco was actually very good none of the high performance filters that cost much, much more, performed any better.
This goes back to what I always say about oil changes. Don't over think it. Get reputable brands and you will be good to go. Those high performance oils and filters that cost an arm and a leg aren't extending the life of your motor, but they are emptying your pockets in a very efficient manner.
It depends on what one is after. If one is just after effective filtration, yes, the K&N costs way more than one needs. And with motor oils, it also depends on what one is after. Regular oil is fine, but many people use a synthetic because of the superior anti-friction qualities, coupled with the added benefit of reduced drag on the engine due to a thinner oil.
But for me, the anti-drainback valve and the construction of the K&N--plus the fact that it flows more oil effectively through the engine is good-- because it reduces parasitic drag on the engine (oil pump doesn't have to work as hard) and those small things add up. It's the same reason why I use synthetic oils over regular ones--and better quality ones. Usually the generic in house synthetic is perfectly adequate, but the extra money spent is usually for the piece of mind in my case.
Oil changes and filtration are something that are comparatively cheap in the long run of owning a car, if you're maintaining it, as opposed to having engine problems (worn bearings, etc) from improper maintenance.
I'm not sure what other people's cylinder head temperatures reach, but mine are usually at about 175-185 degrees in everyday driving. The less strain that you have on your engine, the less heat is generated within it and the added benefits of oil creating less friction become apparent. Right now, i'm having troubles properly putting my power to the pavement with 315's on the back of my car while running stock heads/ cams. These little things add up to a pretty good build.