Your point about timing is well taken, however the HD600/650 were definitely not considered mid-fi when they came out. They were arguably the best dynamic headphones in the world at the time and the early reviews always mentioned how incredibly expensive they were. It wasn't until the HD800 came out five years later, that dynamics crossed the $1000.00 mark (no Audeze or HiFiMan yet).
Tyll was running the amp company Headroom at that time the HD650 was released and in their catalog, he raved about how the HD650 was the best in the world. His previous favorite was of course the HD600.
Back then it was basically a fight between Sennheiser, Beyer, and AKG for the best forming the classic trio. The early/mid-2000’s was mostly $300-500 being the top dogs and those were mainly the HD 600/650, DT 880 (mostly the 600 Ohm variant) and K701, etc. There were a couple odd dynamic headphones that cost more than a $1000 back then such as the R10 and a couple others but that’s it.