Thanks for all the responses. Looks like most people would "prefer" a higher capacity battery if the weight penalty is not significant.
I agree with many of you that anything beyond 17.5Ah, will become too heavy. Having biked for over 50,000 miles in the last 8 years, 840Wh would suffice for most riding conditions (except a few edge cases) and a spare charger can be used if needed.
Last year, when we started the project, we wanted to keep it under the $2K price point (as indicated by the title of this thread). But, with the recent fiasco of electronic chip shortage and other component shortages, the prices of most components have gone up and the supply chain in Asia has become difficult to deal with.
We also realized that we would rather deal with educated customers who are willing to pay a slight premium for a higher quality bike than compete with $1500 bikes straight out of china with poor-quality components.
It is much easier to deal with educated customers who understand the benefits of a nicer controller, torque sensor, higher capacity battery with 4-5 yrs of warranty, etc.
So, the bike will cost a bit more than $2K, and to offset that, we would want to offer a larger '17.5 Ah' battery with a very long cycle life, a true FOC sine wave ASI controller, suspension seatpost. It will have a battery larger than the Stromer ST2 (814 for ST2 vs. 840 for Shakti) and a very similar controller but for less than $2.5K total cost and I think that is a truly incredible value.
Will there be a difference in the look of the bike between the two batteries?
No, the bike geometry will be the same as before and will maintain its sleek aesthetics.
17.5 if there is no significant weight increase.
It will add about 1.75lbs extra.
Our goal is to keep it in the mid-'50s for best handling and performance. I will confirm the weight in about 10 days with a picture.
Hard to do in short term, but long term I like the idea of two models, a light and a heavy. Light = 14ah battery, lighter narrower tires (~50mm), rigid fork, 5-10 lbs less; maybe rack and fenders optional (I thought I wanted full fenders but I've been happy with a clip on rear fender on my road bike, but work from home makes that a lot easier). Competes with the Trek Allants, Giant Fastroad, etc.
The Shakti as configured is what I see as the heavy version, with the bigger battery.
Ideally, if we can build a bike in the mid-40lbs range, that would be fantastic but that would involve complex modifications. I think a lighter bike + minimal assist is preferred by strong riders but for a majority of folks, they would prefer a stronger assist and don't mind a 55 lbs bike. I mean, Rad Power Bikes, Aventon fat bikes are 75 lbs and almost 100,000 riders bought those bikes last year!
From my experience, nobody complains if the battery pack is higher in capacity but lower capacity would immediately put us in a tricky situation with 20-30% of the riders.