Past their prime is probably a mischaracterization, since i3s contain the same new technology as all other Intel CPUs, but I do agree that 2 cores is getting on the thin side of comfort moving forward. But i5s are not just "a few bucks more," and even if one was to go with a low end i5, it won't have the single-thread performance of an i3, and that still matters.
Tests by Xbit Labs show some surprising gaming results with the new i3s, as well as some highly threaded results that are predictably lackluster. I agree that something like an i3-4340K would be a very interesting animal, indeed.
I shouldn't like the i3 as well as I do, given that I am traditionally a "moar cores" kind of guy, but these new units have earned my respect with their very efficient use of execution resources.