I think that most of the money went into the engine development, and the initial art direction. The problem with spending (that much) money there is that you don't really 'see' the direct outcome, because preproduction is supposed to be completely invisible.
I think the custom engine was created with the idea of planning many more Adventure Games - but I honestly think that if they had gone with something like UNITY they would have gotten the same results in a 10th of the time (and budget).
That said, the amount of animation in Broken Age is insane. You can see just how much work went into each and every cut scene - but I think that there are just too many of them! There is clearly a ton of reliance on the cut scenes to tell the story.
Animation is VERY expensive, and seeing how reliant they are on it to tell the story I can see how their budget exploded as much as it did. I think that they could have easily told the same story with less animation and more 'game'.
Its still a beautiful game, and the artists at DF should be proud of what they have done. If you took out the walking around parts, you could easily turn this into a film...and when you look at it like that, $5000 000 (or whatever the current spend is..I stopped following the nitty gritty a while ago!) to make what is essentially an animated Lord Of The Rings Trilogy is NOTHING.
Games have that advantage over films...every time you have a piece of dialogue it doesn't have to be a carefully animated, synced, and choreographed sequence. There is an expectation in a game that you DON'T do that - that you stay IN the game world. Its almost like Broken Age forgot about this, and they were worried about people not having a 'cinematic' experience.