Why would Musk assemble an engine design team and then not utilize it
to its fullest capacity? Merlin 2 is in development, but Musk has been
slightly burned by the calendar on Merlin 1 development. Better to put
a marker out there with the new RLV structures and then work the Merlin
2 into the mix when available.

It doesn't seem to make sense to purchase the RS-27 when the Merlin 2
is already in development, no matter the cost differential between the
RS-27 configurations and the Merlin 1 configurations. The correct cost
comparison would be between the RS-27 and the Merlin 2. Not much info
on the Merlin 2 has been released, so at this point we can only
speculate.