If I'm paying $700 on a phone, I'd want to make sure it's as high-quality as they can make it.
But that's Chex's point...you AREN'T paying $700 for a Nexus.
I actually kind of agree with both of you. While I do enjoy having a solid, "premium" feeling device, I understand I can't have that and only pay $350 or $400 off-contract. It's a trade-off...and the manufacturer's develop all sorts of ways to make a plastic body feel less...plastic.
Anyway...if I'm spending hundreds of dollars on a phone and plan on keeping it for two years, I'm putting a case on it. As careful as I am with my phone, there are always those moments when I'm in a hurry or trying to juggle or carry multiple items and the phone falls. My Otterbox has kept my Galaxy S3 in almost mint condition for almost two years. It ain't pretty, but it does its job well. Besides...nobody really ever looks at my phone and I never really look at anyone else's. Nobody really cares what your phone looks like.