This is the well known phenomenon of "vanity publishing", an instance where someone is so "invested" (in a non-economic sense) in a particular cause or belief as to lose sight of economic (and other) considerations. At that point, they are willing to bear the burden of bringing it forward, and the running economic counter is a secondary consideration.
There's nothing wrong with this as long as the vanity subject does not destroy the economic viability of the "publisher". A millionaire (or even a hundred-thousand-aire) can afford to throw some tin at a project like the C melody saxophone. The worst that's going to happen in that case is that some pin money is going to be thrown aside.
In the case of vanity publishing gone bad, the publisher throws everything that he has into the endeavor, only to find that he has a huge stock of Heckelphones or C melody saxophones piled up in the back room, a zero in the bank account, and no orders in the pipeline.
In the book world, you can get any book published, as long as you are willing to bankroll the entire effort. You can get someone to print anything (and there are any number of publishing firms willing to do so), and many otherwise marginal authors do so every year. Their books pile up (most never even make the remainder tables - the authors themselves hold the copies that they have already paid for), the publishing house that does the actual printing gets their expenses covered, and all of the economic damage lands on the poor (both in the figurative and in the literal sense) author.
Saxophones are a bit different. For one thing, they don't stack very well, and for another they are more "hand work intensive". As a result, it's unlikely that a run of something like C melody horns will exceed more than a couple of dozen or so, Chinese efficiencies in productive means not withstanding.
Look at some other, "semi-vanity" publishing efforts. iPhoto books produce a quality product from your (hopefully) quality photos, one that stands up with the best of professional produced photo books. However, the producer pays dearly for the privilege, with costs well up there. Only the massive cost-saving measures of the off-site software and hardware keep the price below $40.00 per unit.
Then too, bass saxophones clearly fall in this category. Selmer, Orsi, Mr. Eppelsheim and others make the things, but they don't make very many of them (witness the long wait time and low inventory of them worldwide). And, the few that they make are very, very expensive. High cost and low inventory, combined with a reasonably limited demand (despite the various "Wouldn't it be neat to own a bass sax?" postings, few people actually need to own one) keep everything balanced in that arena.
There are hopes that advances in computer modeling and "real time casting" with "printers" that construct a 3D model through intersecting laser beams, plastic solutions and endless swipes of the "printer head", will allow the construction of physical objects in the same way that computers have enabled the production of printed materials. That day is getting closer, but it's not yet here.
(A friend of mine has been looking for years to replace a rather complicated plastic foot on an instrument stand. The foot has a solid angled end combined with a cup-like sleeve that fits over the leg of the stand, and the others are made of a very hard (yet still flexible) plastic. The last that I heard, he had been advised by the industrial modeling folks at the very large oilfield equipment firm where he works that doing this with their 3D fabrication machinery was "doable". However, few of us have cheap and easy access to a $500,000 piece of equipment. And, making the jump between flexible thermoplastic and sheet and cast brass is a huge technical barrier.)
Still, who knows? Perhaps someone will discover a hidden cache of Selmer horns from the 1920's, and the whole point will become moot (to quote Jesse Jackson).