Sandy -
In regard to your question about how consumers felt about the Lady K turning into an '800, I suspect that we are overwhelmingly the only group of folks who would really put much thought into it. Surely a few consumers might, but I'd say most of them bought their machines, and did not pay attention to what was available again until they had to buy the next machine, years later. Overall I think we as a group know far more about our machines, new or vintage, than the average consumer, and we care far more about them in various ways as well. We probably know more about them than many sales people, current and vintage.
In the case of the Lady K turned Kenmore 800, I only know of one of those situations, and that one didn't happen overnight or when the original Lady was close to new. The 1966 Lady did lend nearly all its design DNA to the 1970 and 1971 Kenmore 800 lines, but not before also spawning three late 1960s Kenmore 900s. In the case of the 800s, these machines were not three speed, and they lacked the Roto-Flex agitator -- these were significant feature of the Lady. If a buyer of a 1966 LK noticed the 1970 models, they probably did not know the series as the machine doesn't mention it anywhere visually, and after four years, the person most likely figured that change is inevitable. Heck, the way that Kenmore revised their consoles so frequently back then, an astute buyer was probably surprised to recognize the similarity after so long.
What might be a more likely question is what did the consumer think, after getting a Lady Kenmore at some point, of the new model when it debuted? I still don't think many consumers paid that much attention, but those who did most likely expected changes and improvements to be made. The example of the car that changed weeks after purchase is a great story and very common, even today, but is a story about someone who didn't do his research. It happens each time a model is re-designed. America's fascination with the automobile though, which does indeed involve a lot of emotion, does not extend to the same degree to appliances. We very much are a niche group in that arena.
As to the 1965 Lady K and next year's 800, the 1965 Kenmore 800 has the same basic console as that year's Lady K. It is not that the 65 Lady got recycled into the '66 800, rather both the 1965 800 and the 1965 Lady K 900 were based on the same console architecture from the beginning. The '65 800 seems to have remained in production much longer than the Lady however (I know they were stil being made in 1968). This console sharing happened with the 1964 Lady K and the 1964 800 as well.
Gordon