A PC-based game console running Steam Linux is being planned by Valve for 2013.

One reason why consoles from MS and Sony are bad is their obsessive DRM and the notion of turning a general purpose computer into a locked up appliance.

But there is another architectural reason which is generic - consolized games degrade the quality of gaming interfaces by making them overly minimalistic (since consoles don't use keyboards), and even developers who release crossplatform games for PC and consoles often save time by not distinguishing these interfaces, and when you run the game on PC it feels crippled interface wise. So I'd say for gaming in general, consoles are a big disservice.

We'll have to see how this will develop.