If you go back about 4 years, a processor supported fewer cores, and much less memory. Servers are getting much more sophisticated and powerful. One server can be like a few "old" servers. So, it makes sense for VMware to change its licensing model, though limits set are debateable. Otherwise, VMware is getting much less for helping its customers to do the same workloads. Unlike before, the licensing model sets no limit on number of cores per processor, also no limit on vRam per host. These changes/improvements are not just for "big boys". Of course, we all know that vMotion and Storage motion are getting nicer not just for "big boys".
Again: A vSphere 4 contract doesn't cover upgrade to vSphere 5. What you mentioned was basically from vSphere 4 licensing. It said that "One of VMware Support and Subscription is the entitlement rights to new features and upgrades. Existing VMware Infrastructure 3 customers who have active Support and Subscription (SnS) contracts will receive new vSphere licenses at no extra charge". It also gave specific upgrading path from VI3 to vSphere 4.