From one artist to another, for a game that's 4-8 hours long with a unique soundtrack and such nice art I feel like a price tag of 5 dollars is selling yourself short. You could double or triple that without a second thought. Itch.io allows you to hold sales on your game if you're worried that some people might not be able to afford a steeper price. Definitely think about it!
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From what I've read the opposite can also happen: people can see the price of something and think it's not worth playing because it's cheap. Better to sell something higher and then put it on sale. It's a weird psychological thing that our society does. You'll definitely want to strike a balance though.
Maybe you can do pay what you want with a minimum rate? I also think your ideas for packages was good too. I'd personally *love* to have a behind the scenes artbook pdf to scroll through or something along those lines that I could buy for an extra fee. You could also sell the custom soundtrack on itch.io or bandcamp and split the profits with the musician.