There are two thoughts about them, and both are pretty much the same. The most prevalent is just what you said about attempting to compete with the MIJ stuff
That's exactly what Ludwig had in mind, specifically going up against Tama, although this line was certainly not inexpensive. I spoke with a gal who worked at Ludwig from 1973-84 (thanks again Dave Heim!) and I recall something about the kits being around $1000, a premium price for a 'budget' kit back then (or now for that matter!)
The second is that this line was offered mostly to organizations (churches?) and schools, hence the name.
Schools were certainly a target, but the drums were available to anyone who knew they existed during the year or so they were around. According to the employee, Ludwig didn't have much literature between '80 and '84, so that series got skipped over.
FYI, the catalog marked "Percussion 80" actually came out at the end of 1978, and would have debuted at Winter NAMM 1979.
Bermuda