My two cents on this machine...
I get a feeling John Sculley wanted to transition Apple into a one-computer company from the day he took over. When Jobs was ousted there were three product lines: Mac, Apple II, and Lisa. The Lisa was quickly canned for obvious reasons although the Lisas sold in 1986 were Mac XLs, which I believe were already loaded up with MacWorks.
I get a feeling the Apple IIGS was nearing completion by the time Sculley took the helm. They couldn't can it because it had been completed and also because Apple IIs were still selling very well at the time. This is why the IIe was updated in 1987 and the IIc+ came out the following year--the computers still sold.
The IIc+ is proof that Apple was trying to streamline everything. Its only internal storage option was a 3.5" diskette, which was rather unusual on the II series at the time (except the IIGS-specific programs). My thought is this--the IIc+ was intentionally given that drive both to keep costs down and to hurt sales.
At the same time Apple was developing the LC, which could be outfitted with an Apple II card. The IIe and IIGS are still selling well to educational outfits at this point but with "Macs for the Masses" Apple was clearly saying that home users needed to move from the Apple II platform to the Macintosh. The inexpensive Classic and LC were proof of that, especially with the LC's backward compatibility card.
The Mark Twain, at the same time, was probably canned because it was as far behind as other Apple IIs. When the last IIe was made in 1993 it had 128K RAM on board. By comparison the lowest-end Mac of 1993, the Classic II, had at least 2MB in each unit when shipped and most seemed to leave the factory with 4MB by the later days. If the Mark Twain was supposed to be as powerful as a 128K, it would have still been trumped by the low-ends of the early 1990s, even the original Classic (since it had a RAM ceiling of 4MB and ran a Motorola 68000, not a 6502--to show just how far the 6502 had fallen on the depth chart keep in mind each IIfx came with a few on board just to drive the ADB interface).
The transition from the Apple II was one that obviously had to be made. As great as the Apple II was (and still is!) the Mac offers far more power and was already light years ahead of the Apple II when it came out in 1984. (About the only thing the II could do that the Mac couldn't was display color, and that was remedied and improved upon in 1987 with the first Mac II).
The IIe was also rather inexpensive to build by the end of its run. Apple saw a larger profitability margin in low end Macs and instead decided to produce them, especially because it was easier to advertise and push a machine that was running a current operating system, not something left behind from 1977.