Why hasn't it happened yet with that logic. And why is the Wii the number 1 selling console if PCs have better graphics? They are separate markets. I doubt console casual gamers and hardcore gamers who love their gamerscore and trophies and online friends and money invested in the system would just give that all up just to have pretty graphics with an expensive pc. Chances are they already own a PC.
The PC market is so vastly different than consoles its impossible to compare fairly. And consoles only compete with each other. Console wars do not include PC's for too many reasons. Clearly you are a PC gamer and your only concern is how weak this GPU is compared to modern PCs yet its more than likely far superior to whats in the 360. That's all that matters. To say the system should be $100 shows just how in tune you are with console gaming history.
It hasn't happened yet because they keep making updated consoles. So you think that if no one made a new console for 20 years people would not start playing PC games more? The Wii is the #1 selling console because it was different, not because anything about it was good.
As far as me being a PC gamer, last June is the first time I had played a PC game in over 10 years, and I was very impressed with what PC gaming has to offer. I have owned almost every game console ever made since pong, and the commodore 64, except for the 3do, jaguar, and turbo graph 16. All 3 of those consoles though were owned by friends and we bought them so we all had different consoles and could play all the games. I currently have a 360, wii and ps3 that are played, and at least 4 or 5 old consoles laying around. I still think the turbo graph was the best console ever, just because you could play the same games on the console and handheld.
The reason I say the new xbox should be around 100$ is because they will be putting a GPU in it that will have what will probably at release time be a 30$ or less street price card, and will cost them something like 5$ to get. If the rest of the components in it are of the same quality as the GPU, then it will be a very cheap console as far as hardware is to produce. Why should we pay 300$ or more for something that has 100$ of hardware in it?
I know the PC market is vastly different then consoles and they are not really comparable, but that's because console games have generally been comparable to PC games. If it gets to the point where PC games are far beyond what consoles can do, then I think people will want to play the best games. I went to playing some PC games because of how much better everyone said the racing games are on PC, and was surprised at how good the PC games from 2006 were.
All i know is that if the new nextbox, or ps4 doesn't come close to what PC games offer at their release. then why would I waste my money on them? I expect that after 8 years, the xbox should improve by leaps and bounds. Not 6x better more like 60x better. As fast as tech evolves now they should make it as good as they can in a 300-400$ price range, and that's not going to happen with a 30$ gpu.
I really don't see how your not upset with this also. If they used dated cheap hardware and people still buy millions of them, then this will become the way of consoles. We will no longer see major improvements from console to console and games will become more and more casual, and less and less breathtaking. It's already headed that way now, but the consoles are what's keeping most who play great games going. I don't want to play angry birds on my TV, I want to play HD games that look amazing.