I haven't handled any of the new $400 MSRP

Cold Steels, but based on their previous knives, it will NOT be up to the quality of the Benchmades you're looking at.
The GOOD layer in their San Mai III is AUS 8, OK?
The M2 is better than 154CM. Is it "that much" better? It's nothing night and day, just a steel that is both more wear resistant and tougher, that takes a finer edge. The differences are incremental, not huge, but except for not being stainless, the M2 is better in every respect - ie, there are no trade offs, it's just flat out better. But in a knife that you say you just won't be using that much, honestly, I doubt you'd notice the performance difference.
Can you carry a 4200 where you live with no legal hassles?
I don't have a 4200 or even a 420, so I can't really compare them. But I have a 710HS and it is an absolutely great, world class knife.