In my experience, I've found many console games to slow down quite frequently. Just the other day I was playing FIFA 09 on PS3 (the apparent king of current gen console performance) and it shat itself out when the stadium's crowd came into view.
The thing is that most everyone owns a PC these days (unless they're Mac people, in which case yeah, console away) so it's not much of a stretch to get a cheap-arse, high performance GPU in there for a few hundred. Here in Australia, for $250 or $300 you can get a mid-range GPU that absolutely smokes most games on extremely high settings. RAM is dirt cheap currently, and our CPU offerings from Intel these days are insanely OC-able.
Once you factor in that 'playing my console on a 42" screen' mentality, the whole cost benefit of consoles goes belly up. A 24" screen for PCs is a few to several hundred, can run the same res as HDTVs and as a result has much better DPI. TVs give you a larger screen at the expense of simply blowing up the same level of quality you're seeing on a lot of monitors.
At the end of the day, there's nothing wrong with consoles for casual gamers, as it's after all the market that they're aimed at. I just don't see their application if you consider yourself more 'hardcore' and run a decked out PC. The PC's brute power and modularity smokes all.