The 650cc doesn't need to be setup anywhere near as lean as the earlier 1000cc bikes to pass emissions laws.
The later models are better, but not perfect.
That and the gerky nature of the 1000cc bike, people presume as they have the same name, style and engine description that the engines are the same but one is bigger.
In fact the V-Strom 1000cc and 650cc engines are quite different internally.