Stainless steel coils facilitate temperature-controlled vaporisation, which is a crucial advance in harm reduction. Controlling the temperature of vaporisation significantly reduces the production of aldehydes and aromatic hydrocarbons, which are created by the thermal decomposition of propylene glycol and glycerine; these decomposition products are by far the most dangerous components of e-cigarette vapour.
http://www.ecigarette-research.org/research/index.php/resear... http://onlinelibrary.wiley.com/doi/10.1111/add.12942/abstrac...
Stainless or Kanthal at 500C or something should indeed be quite inert, it's just not that hot.
Power-controlled devices rarely exceed 300C in normal use, because there is considerable airflow over the coil combined with evaporative cooling. Excessive temperatures can be reached if the device is inadvertently activated, or if the liquid flow to the coil is inadequate.
As you say, kanthal and stainless steel should be very stable at these temperatures. Pure titanium wire also works with temperature control and completely avoids the issue of chromium, but there is some debate over the potential risks of titanium dioxide nanoparticles.
(I actually used Kanthal wire sold for DIY vaping things professionally at one point, in a ~1200C heater in vacuum. It's not inert enough in those conditions, sadly)