I think fabric selection should also be based on the use of the quilt. Spending over $100 for fabric & batting to make a treasured "heirloom" quality quilt is quite acceptable. To overspend on fabric for a quilt that goes to a hospital for NICU babies, or to a toddler who will drag the quilt around, necessitating frequent washing and relatively short term life doesn't seem like a good use of my $$ resources. I do appreciate the difference in the quality of the fabric. Sometimes I can afford to spend $$ for the nicer fabric, but most often I cannot.
I have part of a quilt that my grandmother made over 100 years ago using household use grade fabrics. Although it is fragile, it stood up to many many washings in a farm household over it's life. If my quilts make it to 100 years old, no matter what the fabric quality, I will look down in amazement from Heaven!!