If Apple truly wanted to kill the Macbook line, they wouldn't do it by spending millions of dollars over several years purposefully producing crappy products they don't believe in. They'd just announce they were killing the Macbook line.

That hasn't happened, so presumably, Apples believe that laptops fill a niche which tablets don't.

Well, what is that niche? The primary difference between a tablet and laptop is that the latter has a keyboard. If you're buying a laptop instead of a tablet, you probably want a good keyboard!