You definitely have a point there, Stephen. What I'm trying to say is, if you are serious about making a game like Assassin's Creed for Xbox 360, you probably will end up with a similar bill (when compared to a PlayStation 3 title). It's probably just a question of how many features you choose to use (Tengai Makyou ZIRIA was a remake and definitely did not make use of all the 360 features and therefore probably was rather cheap to develop). You mentioned a good point with PlayStation 2. There is definitely a difference between Final Fantasy XII and say, Generation of Chaos IV. This gap can be attributed to the quality and quantity of human and financial resources of the respective development company. That gap might indeed widen on PlayStation 3. But then again, it's up to the respective company on how much it wants to push the envelope. I guess as a small Japanese company you still can release games that look just slightly better than the latest generation of curent generation games and people in Japan will buy them nonetheless (think of love adventures, dating sims or may be even strategy RPGs). Obviously, it depends on the audience you are looking at. If you are Square Enix or Konami you can and will spend billions of yen on the development of Final Fantasy XIII or Metal Gear Solid 4, knowing full well that you will be able to sell five million or more copies of the game worldwide. If you are Idea Factory or Gust, then you have to create a game with 30 instead of 200 staffers in 1.5 instead of 2-3 years, because you won't sell several million copies worldwide, but say 200,000 copies in Japan. To make a long story short, while development costs are definitely up significantly, the increase of these costs definitely depends on what type of game and audience you have in mind.
I guess blu-ray is actually in a better position than Sony's other proprietary formats. After all, it was jointly developed by Matsushita Denki and Sony and has a lot of support in the electronics, computer and film industry. The major issue with blu-ray and PlayStation 3 is the following: Apparently the blu-ray drive is the single component that makes the PlayStation 3 so expensive (even more so than CELL, RSX or the harddisc). Had Sony Computer Entertainment not adopted the new format for PlayStation 3, the entire Sony Group and with it, the blu-ray camp would probably find it hard to compete with Toshiba's cheaper HD-DVD. That is always the challenge for Sony. How to create a profitable and widely accepted integrated product that also supports the company's other hardware (blu-ray) and software (games, music, movies) offerings. Albeit a success story, PlayStation Portable showed just how difficult it is to accomplish such a complete integration.
Edit: Good point, Jason. There was a time when RPGs would cost 10,000 yen or more in Japan as well.