Nice argument Pana, I listened in on Bobby Kotick (CEO of Activision) telling analysts that his company will certainly raise wholesale prices of their games by $4-5 next-gen. That would bring the cost to the retailer up to ~$45 per unit, there is no way the $50 msrp will hold. $55 at a minimum, probably $60.
For the 2nd largest US publisher to say they;re hiking prices openly it has to be assumed that Activision know 1st parties and other large third parties are on board with the price hikes. Certainly Microsoft must have indicated they're aiming for a universal $60 price-point at Xenon launch and EA are going to follow. Given the increased costs as you've outlined and recent success of Madden CE, Doom III and the enormous pre-orders of Halo LE you can't really blame the publishers for hiking prices up, either through technological necessity or their bottom line.
I don't believe publishers are going to release launch games at less than $40 as suggested, you had the likes of Gradius III/IV and Aqua Aqua retailing at the same price-point as SSX and Madden at PS2 launch. The hardware providers don't want their latest high-tech, whiz-bang machine play host to unpolished, at least in the graphics dept., games, it puts off the early adopter and will allow the competition to crow.
$60 msrp opens up plenty of possibilites along with a cheaper downloadable version (don't believe the manufacturers would do this, they won't want to piss-off the likes of Wal-mart). Will Nintendo think about Matrix based ROM as a storage device for Revolution? Could there be a shift in payment for online services to the packaged goods i.e. $50 offline version and $60 online? Are Sony/Microsoft/Nintendo going to hike license fees, perhaps using the "excuse" of value-added software tools such as XNA? Plenty of opportunities and I'd love to know exactly what Microsoft have told 3rd parties about their business model for Xenon.