If I was in charge of a large publishing company selling ebooks, which (luckily perhaps for the world) I am not, I would be scanning the internet/torrent sites for copies of works that I had the rights (and authors permission) to but not a digital copy. I would offer the untouched copy at a low price and an improved, formatted version at about $3.00 more.
This would put the shoe firmly on the other foot, with pirates resentful that their work is making a profit for the publisher. An interesting legal issue I am sure.
If pricing was at $1.99 and $4.99 respectively I am sure you would see approximately equal sales at both pricing levels. People like pretty shiny things
As to the piracy statistics, I doubt that 1% of the world's reading population access torrent sites. And with those that do, it is for the movies.