If you're comparing touchscreens on the desktop with mice on the desktop, this is certainly true. But touchscreen input on a tablet device holds up pretty well against a mouse on a desktop. Maybe beats it.
However... game console controllers are also not as good as a mouse, and yet they now drive game sales and development.
I guess you mean for FPS, only ? For platform games, for fighting games, these controllers are perfectly adequate. The reason why console FPS have become more popular on consoles than on PCs is simply associated to market share of console hardware, big budget exclusive titles (Halo, Killzone, Gears of War) and is not even remotely linked to how good the controls are.