PASADENA – With the tiny but fascinating subset of vehicles broadly defined as “supercars,” one argument typically crops up: Is it worth the money?

From Lamborghini SpA and Ferrari SpA, the upper crust of the category, to the high-performance variants of volume-production vehicles that anchor the lower end, critics usually harp that these fast, fidgety vehicles don’t make much sense, particularly if value for the dollar is a criteria.

That holds true for Audi AG’s latest entry, the ’07 RS4. The base price is $66,000. In real terms, it’s probably not worth it, as those self-proclaimed bean counters certainly will insist. But in this rarefied class, the “sell” is not dollars and sense, but adrenalin and emotion.

By that measure, Audi’s scorching new RS4 is a bargain.

Yes, the sum of the RS4 amounts to a lot of tweaks to what already is a satisfyingly sporty compact sedan, the A4.

But the RS4 is intensely tweaked – to the point where BMW AG engineers long famous for their own tinkering of the mighty M lineup of in-house “tuner” vehicles would do well to start looking over their shoulders, because Audi is coming up fast.

The genre relies on silly horsepower above all, and in that respect, the ’07 RS4 – the second generation of hyper-performance A4s from Quattro GmbH, Audi’s tuning and customization division – sets a new standard.

The RS4 uses a heavily modified variant of the Volkswagen Group’s 4.2L DOHC V-8, most recently on duty in Audi’s new Q7 cross/utility vehicle.

But similarities end essentially with displacement, Audi is quick to point out. All the moving parts – including the FSI (Fuel Straight Injection) direct-injection fueling – are exclusive to the RS4.

What that means is one of the most bombastic V-8s in production. The power is sensational with 420 hp at 7,800 rpm; 100 hp per liter from a normally aspirated V-8 is unarguably exotic-engine territory.

And if the specific output isn’t a giveaway, the power peak of 7,800 rpm should be. In fact, the RS4’s new V-8 revs lithely to a thrilling 8,250-rpm redline.

Underscoring this engine’s high-rev design intent, torque is a more prosaic 317 lb.-ft. (430 Nm), less than from a lowly pickup truck V-8. Audi says 90% of peak torque is available from 2,250 rpm to 7,000 rpm, so it’s easy to get most of what twist is there.

But after a morning’s worth of exploiting this fabulous V-8’s Mississippi-wide speed range, a hard-charging driver begins to understand revving this engine is far from the painful experience extracting the most from a high-performance 4-cyl. can be.

We are most dumbfounded by our seat-of-the-pants tachometer. Many times, we find ourselves hustling through canyon-road “esses” with this tidily sized V-8 humming at 6,500 or 7,000 rpm – yet scarcely noticing the elevated rpm.

That’s something one typically just does not do with a V-8 of any stripe – testimony to the direct-injected Audi V-8’s remarkable noise, vibration and harshness signature. This V-8 would be right at home under the hood of any “exotic” marque.

For some additional intrigue, there’s a “sport” button on the dash that speeds the throttle response and opens a freer-flowing path in the muffler.

The deeper, aggressive-cam sound with the sport button is spectacular, but the sport function may exist because engineers needed a dodge for Europe’s finicky drive-by noise regulations.

There is one transmission only – the best 6-speed manual yet from Audi. The auto maker’s brilliant Direct Shift Gearbox automated manual is unavailable because of the V-8’s longitudinal orientation and it’s clutch-crunching potential.

Aside from the flying saucer-sized brake discs and stiffening and lowering of the front 4-link/rear double-wishbone suspension expected of a “tuner” car, the RS4 chassis offers a couple of sweet parlor tricks to complement the outstanding driveline.

First is a rear-axle bias for the signature quattro all-wheel-drive system. Audi engineers have redesigned the Torsen center differential to bias torque, under normal traction conditions, 60% to the rear axle, rather than quattro’s longstanding 50/50 torque apportionment.

This has the effect, they say, of making the car handle more like a rear-driver. It works, quite noticeably, to counteract the nose-heavy handling posture usually implicit in Audi chassis. This is the most neutral-handling Audi we can recall.

The Torsen unit still can send 100% of drive torque to either axle when traction conditions warrant, of course.

The RS4 also is fitted with Audi’s Dynamic Ride Control, a purely mechanical “adjustable” damping system that automatically stiffens each wheel’s damper to counteract acceleration “squat” and brake “dive,” as well as body roll and pitch.

The DRC system also makes a pronounced difference in squashing body roll, but it could do a better job keeping the front end flat when one really steps into the RS4’s seatbelt-stretching brakes.

Audi’s sprayed around some nice materials in the RS4 interior, but apart from the exceptional Recaro sport seats, there’s a bit too much of the conventional A4 still on display. Almost all of the minor switchgear and architecture is unchanged – a little off-putting when paying twice as much as the standard A4.

Doubt about the RS4’s price, in fact, is the only drawback for what is perhaps Audi’s most dynamically entertaining vehicle yet.

The $66,000 base price brings the RS4 smack up against keenly priced competition such as Chevrolet’s Corvette ZO6. For the same money, the ZO6 offers heroic power (505 hp) and performance numbers even the RS4 can’t match, not to mention arguably more styling cache.

And there are plenty of other serious performance cars available at the same price, or less, including the RS4’s natural competitor, BMW’s M3.

The ’06 M3 is priced at $48,900, but it sits on the previous-generation 3-Series platform and uses a 333-hp 3.2L inline 6-cyl. Like the RS4, the all-new M3 coming in 2007 also will flaunt V-8 power – and likely bring a commensurate leap in price to the RS4’s realm.

But Audi beat BMW to the punch with a V-8 for its compact sport sedan, making the RS4 a serious performance car worthy of its heavy price. After all, 0-to-60 mph (97 km/h) runs of less than 5 seconds and a governed top speed of 155 mph (249 km/h) are not inconsequential.

And the RS4’s utility and all-weather potential obviously provide certain value not found from the 2-seat sport coupes and exotic cars with which the RS4 can play.

Moreover, buyers have to worry about exclusivity: Audi says it will sell only about 1,000 units annually in North America.