And they definitely aren't abandoning this philosophy seeing as they announced the SP4 at the same event. The Surface Book is a competitor to the Macbook Pro, but they aren't slowly creating a Macbook Pro. My sense is that Apple are now slowly moving in this direction.
The goalposts didn't shift. High priority complaints just tend to get more visibility than low priority complaints. Each iteration of the Surface Pro has fixed a high priority complaint, shaving it off the queue and revealing the rest of the queue. But the entire queue was always there from the beginning.
In other words, the issues that are now primary were previously secondary or tertiary in prior iterations of the Surface Pro. They existed, but there was little reason to focus on them because of other, more glaring problems that had to be fixed first.
I see it the other way. The SP2 was too small to use as a laptop so the lack of a proper hinge and keyboard was secondary. SP3 was big enough to use as a proper laptop, so the lack of a proper hinge and keyboard became more glaring.
In any case, the whole narrative is a bit revisionist. Here's me complaining about the Surface 1's lack of "lapability" almost three years ago: https://news.ycombinator.com/item?id=4869442. It was a common complaint at the time.
Surface Book - I want a laptop that I can use as a tablet once in a while.
Surface Pro - I want a tablet that I can use as a laptop once in a while.
Both- Dock it and replace your desktop.
SP Book isn't so much an evolution of SP1 as it is an abandoning of most of SP1's key design decisions: laptop-size rather than tablet-size, full-keyboard rather than keyboard-cover, and clearly designed to be used foremost with keyboard and trackpad attached (most of the battery is in the keyboard base) rather than with touch.
It's slowly worked its way towards being a MacBook with a stylus and flexible hinge, instead of being an iPad with full-powered CPU and keyboard cover. And that's probably what it should have been all along.