This type of product design decision happens all the time. Whenever you're considering component costs, you have to evaluate all of the options. You're mischaracterizing it as a fight between engineers and management.

And second, Amazon did the right thing and listened to them, when they didn't have to. They could have given the project to a different team, reassigned people, or even fired them.

Instead, they had the sense to listen to their engineers, which was the right thing to do.