There's a lot of reasoning here, and some of it makes sense. But a lot of the time it's just where the founders are from. In the 80s when the home-computer revolution was kicking off, a lot of the kids/young adults that got good at making games and made a fortune off the nascent industry then went off to set up development studios. They were often from the shires, because it was a wealthy/middle-class pursuit, or was at least easier to get going when the family support machine was backing you.

The low pay thing I think is a misnomer, I worked in games from 1995-2005, and although yeah the pay wasn't great compared to other industries, it wasn't bad, and I worked full-time for three different London based studios and contracted for another two. It was certainly enough to live in London (at least then before the property market went crazy)