Are CPUs of the same family the same chip, just with a different...

In your case, yes they are the same chip, with the exception that during manufacturing (after speed/quality testing) Intel locked the max multiplier.

Overclocking is normally not the exact same thing as getting a CPU with a higher freq, since when overclocking, you are normally boosting the speed of the FSB, which when multiplied by the (fixed maximum) multiplier gives you the final core speed. A faster chip from Intel will run a normal, non-boosted FSB, but with a higher multiplier to give the same final core speed.

In practice, if the overclocking works (a big "if"), then the overclocked chip is actually slightly faster than a chip from Intel with a bigger multiplier giving the same final core speed.

If it's just the same speed, then why are processors with higher MHz speeds selling for much more then?

It's the price structure of the CPU business, which is derived from the differences in CPU quality during manufacturing. Long story short, many different models of CPUs come from the same CPU architecture. The best quality CPUs are sold at higher speeds and higher profits to make up for losses in non-working/lower quality CPUs.

It cost 2 billion dollars to set up manufacturing a line of cpu's [ give or take a couple of hundred million ]

No one would spend that much to set up to make each model in a range of different processors
All 65 nm C2D and Pentium dual cores are identical silicon .

All 45 nm C2D are identical

The core 2 quads are just 2 C2D's so theyre the same too


AMD sell 2, 3 and 4 core Phenoms . All really 4 cores but if one or two are faulty they still make money

And yes it costs intel EXACTLY the same amount to make a $20 cpu as it does to make a $1000 cpu

"And yes it costs intel EXACTLY the same amount to make a $20 cpu as it does to make a $1000 cpu" except the $20 chip probably will not pass the same speed tests that the $1000 chip will. And in the case of the $1000 "Extreme Edition" chip, there's a fair amount of marketing involved.