Whilst this is purely speculation on my part, I have always assumed the reason they settle rather than go to court is because they don't actually want the patents invalidated. The patents serve as a barrier to entry into the market. Had Microsoft - for instance - gone to court, and had the patents invalidated, Valve would not have been sued now.

This discourages competition from smaller outlets, and thus allows the big players fewer competitors. Though, again, pure speculation on my part.