Relative to the cost of manufacturing, all toys are highway robbery. You probably don't want to know what the wholesale costs on di ecast toy cars are, for example (it's effectively zero).
But that's how the economy works, there's a profit margin at every step. If there wasn't people wouldn't sell things or do things.
The financials are similar to the food conglomerates (P&G, Kraft, Unilever, Mars etc.). The businesses are hit-based, and each firm usually has one or two very profitable lines and a lot of lines that lose money or break even.
Low manufacturing costs but very high user acquisition costs. Toy companies rank in the top 10 on advertising dollars spent (after automotive, food, pharma, department stores, fast food, telephony, alcohol). Mattel has $0.7B of net income on $6.2B of revenue. But if you took the Barie and Hot Wheels businesses on their own, the margins there may be 40%+, but subsidiaries like The Learning Company are losing hundreds of millions per year.
The Lego Group[0] has 0.55B euro net income on $2.5B euro of revenue. A better margin than Mattel, but a smaller business. Lego also has new release lines that they depend on to continue growth. For eg. the Star Wars tie-up, Lord of the Rings, etc. some of these work, some don't. They need to keep giving buyers a reason to come back and purchase more - which is why Lego has gone from generic buckets of bricks to specific sets with instructions that you assemble once and don't disassemble.
Not mentioned in OP is that until a year ago Lego had a strong world-wide patent. It has only been the last 12 months that competitors have released similar sets of bricks which are forcing more competition on the company. Lego would be happy to hear that when I took my 3 year old niece shopping she only wanted the Lego brand Lego, and in that case only the sets that were cross-branded with characters she recognized (I think it was Dora the Explorer).
If you want to find out more, the largest toy co's are Mattel, Hasbro, Bandai, Lego, Tiger. They are all large co's and the other 4 besides Lego have suites of brand names and subsidiaries.
According to the wikipedia page, the last Lego patent expired in 1989. There may have been some design patents that expired more recently perhaps (assuming wikipedia is correct) ?
My experience of the Lego knockoff products has been that they use inferior plastic that isn't quite as stiff as the Lego formulation and they don't get the internal moulding right either, so the parts don't lock together in quite the right way: they don't have that secure 'click together' feeling that Lego proper has.
Profit has little to do with it. Price is determined by supply and demand. Legos are expensive because there is a strong demand, and through branding Lego has made them into a non-fungible good over which they have a monopoly on supply.
The same is true for most toys. Kids don't ask for "dolls" they ask for "Barbies" or "American Girls." These companies use the resulting pricing power to set prices to maximize profits, which is a point higher than it would be if they were competing to supply fungible "dolls."
But that's how the economy works, there's a profit margin at every step. If there wasn't people wouldn't sell things or do things.