Very good points. The ability for publishers to discount games on steam where they otherwise couldn't in physical retail markets is that they have just one place to set that price and distribute it.

MS by eliminating the used game market forces consumers to buy these older games in digital form where publishers can offer these sales. I don't know if that will make them any cheaper than if someone simply bought a used game from ebay. It certainly won't affect the price of new games.

What bothers me is the notion that these digital purchases could go away at the end of the XBox1 generation. Consoles notoriously aren't backwards compatible friendly. I'm fine with buying PC games digitally on steam as I know they'll work as long as whatever Windows version I have is still around. And I would wager Windows 7 will be supported much longer than the XBox1 will be the current generation.