"Such a system would enable Mars colonization but would not open outer space to private economic development. People say the magic number for that is $100/kg."
Well I think we could enable Mars colonization at current launch prices and could certainly enable private economic development at current launch prices.
But as far of having people starting to go to Mars in in order to colonize Mars. I would say launch prices would need to get around $500/kg. And in order to populate Mars with people other than crazy very rich people, you are going to need some kind of private economic development. That seems pretty obvious, unless the people on Mars are going to be part of some new welfare program- tough sell, especially since you don't need a distant planet in order to have an Earth based welfare program.