They in fact do offer their own "consumer-targeting smartwatch, the W1 series, [with] FDA clearance for providing blood oxygen saturation levels." (Source: the article we're all discussing.)

Link to their smartwatch: https://www.masimopersonalhealth.com/products/masimo-w1 It's actually in the same price range as the Apple Watch Series 9.

So their reluctance to license the patent to Apple may be probably partly about competing with Apple, partly about Apple's alleged bad-faith behavior in past dealings with them, and possibly also disinclination on the part of Apple to pay them for a license. But not about Apple's retail price point per unit.