"So why buy a similar engine from Lionel for $50 cheaper with far less of the controls?"
Are you suggesting that new MTH Rail King steamers are available for $360 and diesels for $260, street price? That's not my experience. More like $100 more expensive than these LionChief Plus locos. For some folks that's a big difference, and most people don't use all the features of a Legacy or PS3 loco in any case.
"MTH starter sets have a similar command controller to Lion Chief system!?"
I don't think that's correct. The MTH locos have PS3, a command system, but in order to use it in command you need DCS, so add a few hundred dollars to the set price. The controller with the set will only control one loco at a time, so if you have multiple sets/locos, you essentially have conventional control, and each loco will need to be on an isolated section of track, with conventional wiring.
With the LionChief and LionChief Plus locos and sets, you're in command mode from the initial purchase as each loco can be controlled independently with the remote that comes with the set/loco. Plus the Lionel sets are $100 or so less than most MTH sets. So I don't think the systems and approaches are equivalent in these respects. I'd suggest these new Lionel starter sets have greater initial functionality at lesser cost than the equivalent MTH sets at this point in time, at least until one springs for DCS, which increases the cost differential even further. Two very different technologies and approaches, and to my mind, Lionel now has the advantage in both play value and cost.