Edit2: And you still haven't answered my question. Why N=2?

I thought that N would have to equal 2 in order for the math to work out when claiming that going from A+ to B would always increase utility. It seems like otherwise you'd reach a point where it would lower utility to take wealth from A and give it to A+. But you've convinced me that my math might be off.

I think that I might have made the N=2 conclusion before I reached the "adding resources is neccessary conclusion" you alluded to earlier, and that it persisted as a cached thought even though my newer ideas made it obsolete.

If there are a bunch of people whose lives are so terrible that it would almost be better for them to kill them out of mercy, but not quite, and keeping them alive takes a lot of resources that could be very useful to others, I would endorse killing them, and I find that fairly intuitive.

I suppose if you put it that way. I think for me it would depend a lot on how wealthy the rest of society is, perhaps because I have prioritarian sympathies. But I can't say in principle that there aren't instances where it would be acceptable.