Citizen invented the mass production watch line that Rolex uses but I wouldn't say that Seiko has succumbed to Citizen at all.

Not succumbed. Seiko is repositioning themselves in many ways. The cheap Seiko 5s are gone, the cheap real diver is gone, the perception of them as a budget brand is being wiped away. Now, for Seiko, if someone wants a watch under $100, I don't think of Seiko at all. It is used to be the source for the $40 automatic SNKs and the $99 automatic diver.

For the Solar, their designs aren't as great as Citizen, and they probably see a better market for other designs. Solar limits them surely, but it limits Citizen as well, yet, Citizen and Casio are all into solar and putting it in more and more watches. Seiko is just as capable as them.

Citizen pretty much has stayed on a quartz path

No, they are one of the top makers of mechanical movements and have a lot of mechanical watches in all their brands.

In Macy's and Kohl's which I think you're referring to you do see many Citizens and not as many Seikos but I believe that is deliberate on Seikos part.

Well, I am referring to a particular department store which is not a national chain, which has a good selection of both. I walk by and see that Seiko has a ton of new watches out and new displays. Their Seiko Solar models are somewhat pushed aside and the same old models that were there before.