Maybe part of the problem is the tendency to hyperbolize.
So what happens with people of below average intelligence and physical ability? They're likely to suffer from lower earnings. Should a person of average height and on minimum wage subsidise a well-paid tall person?
In an ideal world, chairs would adjust so that everyone is comfortable and still allow the same number of people on the plane at the same price. However, in the real world, we probably have to accept that allocating comfort based on ability to pay, with a bit of flexibility on both sides, is the best outcome.
I assume it is ok though that a short well-paid person to subsidize a tall less-paid individual?
Most airlines that I've been on have started turning the exit row into a "non-first-class extra legroom" row. On a few occasions I've seen very tall people sitting there. And there's nothing wrong with building a range of legrooms into a plane. But I don't see why there should be some requirement that a costly good - legroom on a plane - be provided to more people than actually want to pay for it.
It costs a much larger premium than the space differential, it largely costs more due to price discrimination, because many fliers in business aren't the ones paying for their tickets. If you're talking about real first class (which can carry up to a 30-50x price premium on the economy rate), there's also very attentive service, nice champagne, multi-course meals made by an onboard chef served on china plates with silverware, seclusion, sometimes even private rooms. I would not characterize it as "largely because of its larger legroom".
If you mean to say that many people choose business/first because of the additional space, that's more correct. But even in business, it's more about lying flat and other factors than simple legroom.
But a sigificant component of the cost is simply that first class carries fewer people per linear foot than does economy.
Allowing the unbundling of services is much more likely to allow the emergence of an "extra leg room only" class, than is a situation where services must be bundled into a standard package. If the prices have to be the same regardless of seat location, and be packaged with an identical bundle of food, blankets, etc, then that's a strong disincentive to attempt to sell a separate class of legroom seats. And it's much more likely that a "standardized seat" will be too short for very tall people than it will be tall enough - and even if it were, that would mean fewer seats on the plane and thus higher prices.
And it's not always as somebody pointed out above that you may chose the door seats for the same price. I had to take a last minute trip for this summer vacation. Those places were part of some "Comfort" plan I didn't even hear of while booking. Fortunately those were the only ones free on the plane and they let me sit there for free. They were booked out for the flight back though...
It's a pain, it got worse through the decades and I fail to understand that development. Was the free market not supposed to make everything better and cheaper? ;)
I'm not saying it's at all comfortable, just that it's rather hyperbolic to call it 'torture'. I have a book, an MP3 player and some headphones, and then look forward to landing. I prefer to have the money than pay for extra comfort. FWIW, I also have a pretty small car for exactly the same reason. I wouldn't call that torture, and wouldn't expect anyone to subsidise big cars just so I feel more comfortable for the same price.
"Having to pay what I deem a high price for a good and/or service I deem insufficient? Help help, I'm being oppressed!"
Wanting enough space for my elbows to be able to stay within the confines of my seat should not cost me 10x as much.
Economy plus might not be the best thing in the world, but 50% more is at least within the realm of human affordability, and partial recline and my own armrest sounds downright luxurious. For 5x as much as a coach fare, the perks better be things I shouldn't discuss on a public forum.
And I don't really care about the quality of food or service, how many times they bring me a hot towel, etc. Just want a good seat.
Airlines have jacked up the prices of comfortable berths people can sleep in on long haul journeys to almost 10x the price of shrinking torture chairs that most of us buy. For a long while business class and coach drew apart in price even as business got more luxurious with flat beds and fancy wines while coach seats in Boeing's newest, most advanced 787 jets are the narrowest trans-oceanic seats ever sold and Spirit/Frontier domestic seats don't even recline anymore.
But that difference was driven by corporate executive passengers whose employers were paying the 10x prices and getting tax breaks for doing so. Corporate sales is complicated and charging more can actually sell more units so the airlines carefully eliminated mid-priced options to force businesses to pay far more for the very profitable business class seats than their marginal cost.
And economic rationality has reasserted itself. Premium economy seating is now common on airlines outside the USA without such easily gamed large corporations to scam. The premium economy is similar in quality to old-fashioned business class seating at prices that middle class leisure travellers can afford. Mostly you can't buy it from the USA without paying a steep premium, but anyone flying to the USA from abroad has been able to for about a decade. Carriers refused to sell it at the same prices in the USA because running the game on corporate purchasing departments is so lucrative. For example, JAL and Cathay Pacific round trip fares between the Far East and USA in premium economy have been about $500-1000 more originating in the USA than in their home countries.
But Delta and American are now outfitting planes with premium economy because it's the most profitable use of space for carriers that have it and supporting the corporate business class sales inflation scam can't hold it back anymore. American is flying the new class on planes already. Even CX and JL prices are starting to rationalize.
So the key variable in airline discomfort has been American corporate purchasing culture irrationality and not the natural division of markets into tiers. Corporate purchasing irrationality and cartel pricing to exploit it are also the drivers of advance-purchase fares, last-minute price gouging, saturday night stay requirements, steep premiums for one-way fares, and lots of other paradoxical and nasty pricing strategies.