I just don’t see why someone would spend close to, or over $40k (easily that much after options and taxes and fees), when there are so many other cars that are better cars in that price range.
What cars in the price range are "better cars," and in what capacity? Most here would disagree with this statement (I'm one of them). The 30-40K range is full of entry-level luxury cars that are essentially Honda Accords with *SLIGHTLY* improved interiors and a badge. You don't start seeing actually good cars until 50K+, and really these days its 60K+.
Is the Golf R practical? Yes and no. If your a small guy/girl, and have a small family, yes, but if you’re tall or big, and have friends or family that want to ride with you, and put luggage in, it’s not. It’s not a big car.
I'm 6'2, and my MK6 GTI and both MK7 GTI's have been very comfortable for me. I have packed my car full of camping equipment and driven 2 passengers 800 miles and the ride was better than my parents' Durango when I was little. My first MK7 had the leather, and my 2nd has the cloth interior. Both were very comfortable for the many 10+ hour car rides I took in them, so in my experience this point is moot (comfort vs. useable interior space for cargo vs. passenger space)
Do people buy the Golf R for its sportiness? 100% yes, and though it is sporty, and can be tuned to be really fast, it’s not a sports car by any means. You’ll get more sportiness out of an older EVO, but those aren’t luxurious like the Golf R is. You can buy a used GT350 for about the same price, and you’ll have a way funner car, better handling car, better sounding car, and just an all around better performing car, which is a real sports car. There’s so many other choices out there is my point, for this kind of money.
The same thing you said about the EVO can be said about the GT350. They're both one-trick ponies. They perform well. That's all. For 99% of people, performance is only one of multiple aspects of consideration, and the Golf R hits every other point (interior luxury, ride quality, and functionality, to name a few) way harder than the two sports cars you mentioned. Everybody knows that a FWD GTI/FWD-biased AWD Golf R is not going to be the highest performing car for the money. But based on all the ~other~ aspects of consideration, you actually get a better value proposition out of the 40K Golf than every. other. car. available.
If I were you, and was set on the Golf R 7.5, I would wait at least another year, so that the car is actually worth the price you would pay for it. I would say this car is worth around $30-35k, but not over $40k. That’s ridiculous. But I’m not the one buying it, so do what you want. I’m just giving my opinion.
You're clearly just not a VW/Golf person. I can get a manual Alltrack for ~23K and put ~10K into it and have a car that would beat a Stage 2 Golf R, for *AT MOST* 10K less invested all-in, and still have more utility to boot. But the Golf R is an icon to those who view it as such. I would probably just get a Golf R anyway, because I've viewed them as the end-all be-all of my favorite car (the GTI) since I was young. And, realistically, if I have the money to drop 23K on a car, finance it, and then put 10K in mods into it, I have the money to finance a 40K car and leave it (mostly) stock - which is what I do with my cars anyway.
It might not be that logical, but with cars few things are "logical" - cars' main function is to get one from Point A to Point B and back again. 98% of people want a car that does the above with as little money and thought invested in the process as possible, and 95% of them can only afford a Toyota Corolla, Civic, or even cheaper (Yaris, Sentra, etc).
When getting a car for "performance" - you are no longer considering things "logically" - because fun is not a driver of practicality.
But almost every one of us on this forum would agree that fun is a REQUIREMENT in our cars, and we are willing to spend more money on a car in order to get that. But still, most of us still want all the things normal people do: utility, luxury, fuel economy, compliant ride, etc etc etc. The 40k+ spent on a Golf 7R delivers a higher overall value proposition to the average consumer (who is willing to buy a "40K hatchback") than just about any, other, car, period.