I was so hyped when Intel hyped up this new SSD tech one and a half years ago (1000x faster this, 1000x greater that, higher density, blah, blah) but in the time since,
Its true they said this, but if you looked into the details it was always going to be a tech that slots in between mass storage like SSD and DRAM. Higher density was over DRAM, not NAND, and speed and endurance is over NAND.
Regarding endurance: Only DRAM versions will have the endurance and performance anywhere near they claimed. The SSD versions were claimed at IDF to be 3x over NAND SSDs in endurance. Like everything in life, there's a tradeoff. SSD versions are likely much cheaper than DRAM.
How do you go from hyping 1TB in a single m.2 card to 16GB?
How? Because the writers were ignorant. The same time when Intel was touting benefits of its 3D NAND technology, they also talked about 3D XPoint. So some writers took the super-1TB-in-postage-stamp storage claim of 3D NAND and combined it with 3D XPoint's performance and endurance.
That's not to say its incapable of reaching those capacities. Just not in the micro form factor 3D NAND based devices will be coming in. The QuantX devices Micron was demonstrating were in the 200GB-1.6TB range.
Also, just because 16-32GB capacity versions are only the ones known through leaks, doesn't mean it'll end up being the only ones. SSD versions will surface through 2017.
The point of the 16-32GB devices are for caching. It seems my predictions that it'll be used to cache platter HDDs were right. I understand the disappointment over small capacity, though I can guess their reasons as well.
Ideally, it'll be used to balance between BOM issues and performance for pre-built systems. Optane might be fast enough to be a real virtual SSD for low cost systems. BOM increase will be quite a bit smaller than going for a full SSD. The only reason traditional SSHD systems don't work out is because you can't use SSD as a cache hoping the whole setup will be fast as an SSD. You need the cache to be much faster than an SSD to keep the whole like an SSD.