Having never heard the Classic I can't really argue with you. However, there are plenty of people on HeadFi, including those who have owned both, who don't concur with your assessment that the difference in resolution is "significant".
I didn't try the Classic because of the problem I had with the treble spike in the HD700. Perhaps purists have the ability to ignore that spike in the Classic. Anyway, we plebeian tin-ear members of the great unwashed public seem to be happy with what Senn has provided us in the S, as the price differential with the Classic is holding pretty stable