This creates an interesting dilemma for the publishers.
The publishers must decide whether to make multiplat games which will look like high-quality PS4 games (because they will be dragged down by Lockheart who must be able to run said games) or release their games as PS5 exclusives in order to make games with jaw-dropping visuals and superior AI scripts.
If the PS5 sells more consoles than the Series X & Lockheart, they will undoubtedly take this route to both ensure max performance as well as sales. The MS consoles will suffer for it.
However, if the high price of the PS5 backfires and makes people flock to the Lockheart, they will have to make low-spec games in order to sell them. Also, if the first-party line-up of the PS5 is weak for the first two-three years, we could be looking at a PS3 'early years fiasco' and only have the console pick up the pace once its true first-party heavy hitters appear (as well as its price drops).
Interesting times, indeed. At least, as long as these things come to pass.