Based on the fact that there have been multiple games with major downgrades, I'd say that the potential of the consoles has already been reached.
No, it benefitted people who wanted bigger and more ambitious games that the previous generation of consoles couldn't handle.
Assuming the 'PS4K' is real, this entire situation could have been avoided if Sony released a more powerful console in the first place. That goes for Microsoft and Nintendo, too.
I doubt that they have, Nintendo was able to make MK8 look relatively stunning on the Wii U and work at 60 FPS throughout (minus 3-4 Players Splitscreen).
Where are those games you are mentioning? You keep mentioning it as if more power will give games more substance but if anything todays games have focused more on Style than Substance which has made today's games on PS4 and Xbox ONE either Broken, Empty or just Pretty Visuals (can even be 2 of the 3). Order 1886 is a huge example of this.
More Powerful Consoles would do nothing but increase the price and force Games to wait even longer to be made so they can use the potential of the console. It is obvious, Nintendo is going for the cost efficient route and it is now the only console that supports Free Online and Backwards Capability, it is a shame they shot themselves in the foot by probably one of the worst marketing attempts for a console and releasing too early when there best games were going to come out a Year later. Remember when the PS3 debut and was almighty powerful, the price was horrificly high and also with a lack of games whihc caused a huge damage in Playstation that thankfully they were able to patch up.
I think we just need more games for the consoles and I'm not talking about the massive projects we are getting. Smaller games that can be made quicker to entertain us as we wait for the games big titles. Nintendo did that with the 3DS, it came out of March with its best games coming out in November-December, thankfully there were some smaller games to look forward too in-between then like 3D remakes and Nintendogs + Cats. Of course this didn't help the 3DS due to its unreasonable price at the beginning but if it was cheaper at the start than it is a possibility.
Power is not going to help gaming at all, let me remind you that this is the first Generation where the most powerful console is winning and it isn't because the PS4 is powerful, it is because its marketing wasn't horrible. Last Gen, Wii smashed the competition with its marketing towards the casual consumers when they were hot and the Wii wasn't even in HD. PS2 and PS1 totally annihilated the competition despite the Xbox and Sega Saturn crushing them in power. Lets not forget the Neo Geo's crushing defeat to both the SNES and the Genesis/Master System. Even in this Generation of Handhelds, the Vita couldn't handle the 3DS success. Console success is simply determined by Marketing (games do help fuel it), nothing more.