I think that this moral dilemma demands further inspection than merely the assumption that irrelevance makes a moral choice more captivating. While it is true that morality will ultimately boil down to consequential thinking if you twist the available options enough (in situations where you can either kill one to save all, or let all die, for example), this doesn't mean that a moral choice has to be irrelevant in a wider scale to sustain impact.
It is not the relevance or irrelevance to greater consequence that creates moral impact in games from any particular action, but rather the comparison (identification) or contrast (alienation) the player experiences between their in-game actions, and their real-life approach. Both identification and alienation are useful depending on the genre of the game and the optimistic or pessimistic tone it is planned to express.
The mistake made by games with morality systems that give full relevance and consequences to "good" or "evil" actions is not that they give consequential relevance to an action, but rather that the choice between those two extremes is always apparent and available. The very essence of moral dilemma, and excruciating decisions that really shake the player's world and bring them into the game, is always found in the restraint of choice but to go ahead and do something they would similarly hate doing in the real world. In essence, the moral dilemma is about priorities, and the philosophical search for what one truly values (and ultimately, what one should value).
There are games who have achieved very impressive, immersive and thoughtful morality systems. Look at Dragon Age: Origins and similar examples like Knights of the Old Republic. While moral actions in these games may not be measured on a scale like in Fable or Infamous, the opinions of those in your party act as a gauge of your own moral outlook, allowing for less alienation or preachy judgement for people who don't have the "vanilla" (in the Western designer's point of view, at least) Christian belief system, and therefore giving these games wider appeal.
Furthermore, in the most successful moral systems, choice is not always supplied (think of Conner's fate Dragon Age's town of Redcliffe), and despite it being a minor inconvenience for the player not to always be a saint when they want to be, the fact that there may be no high choice really allows them to step into the game world and away from their assumptions about what is moral and what is not. It shows them a more complex side of themselves, which they may never have known about before engaging with the dilemma.
The restriction of the full spectrum of moral choices, and the creation of a more complex system of moral consequences, are the finer points where a game ceases being a mere game, and becomes art, because it potentially enriches the player's very soul or ethical consciousness. That is why it is very exciting to see BioWare's work - they understand this fact, and it is still an appeal that is almost unique to them. Let us hope, though, that this approach catches on.
