C-4 is basically the AMR of the explosives skill - only it appears 50 skill points sooner, and can take out far more targets at once. You can literally wipe out the Fort with enough planning ahead and a mere 3-4 pulls of the detonator trigger. It's far more devastating than a missile launcher, more accurate than grenades, better area of effect than mines, and farther reach than the grenade machine gun. The price is fine, as well as the rarity.
Nah, Missile Launcher and GMG are way better. C4 does 250 damage, missile does 200 and a HE Missile does 270 damage. And missiles cost a fraction of C4.
But to the OP, explosives suffers a bad case of over priced. 200 Caps for a Frag Grenade and 1000 caps for C4? Silly, you can buy a whole armory of guns for that! Not sure what the devs were smoking when they set up explosives.