That sounds like an excellent way to destroy any sense of uniqueness that a game's art direction or premise might have. I can't imagine that it would be interesting for every game (or every game supporting this feature; we can at least hope that some games choose not to be endlessly imitative) to look exactly the same - but that's what would have to happen for you to carry your appearance across games. You can either have every game look the same as every other game, or you can have the characters look out-of-place against a non-photorealistic background, or you can require everyone who wants to make an online game to adapt every single character creation option that the system supports to the style of their own art direction. Even barring the technical difficulties of making sure everything transfers, that'd be unrealistically expensive no matter what tools are available. And this is to be a requirement for online multiplayer on consoles?
I think in either case it's extremely difficult to carry over "recognition" using subtle character creation details like that - in real life, so much about the way we recognize people is based on body language and voice. Good luck trying to put that in a character editor. I haven't seen an online game other than City of Heroes where every character didn't look basically indistinguishable from every other, clothing notwithstanding, just because of the way they all acted and moved, and the things that people use to tell each other apart are much more subtle than flashy spandex.
And where do single-player games fit in this? Games with stories, games that don't fit in this Second Life Meets Disney World pipe-dream? Where do you go when you want to stop being your avatar and start being Mario? The only solutions I can think of seem gimmicky and annoying (as much as it doesn't already seem gimmicky and annoying to move an avatar around a persistent meta-world, since surely there'd be ways for impatient gamers to skip that part).
The subscription service would be great... if it's optional. I don't want to pay for games I won't play, and if I am paying for a game, I don't want to have to pay more to unlock new features. The service downloads Madden 20X6 for me? Well, that's great - I hate Madden 20X6. In fact, nothing coming out this month interests me, though that Road Fighter game coming out next month looks interesting. Oh, but too bad, I still have to pay this month. And what's this? Even when it does download Road Fighter, I have to pay more for the character editor? No thanks. Let me choose what I don't want.
There's much good to be had in an idea like this, a persistent character setup, a comprehensive subscription-based game service, never having to swap discs again. But, even surmounting technical issues, it seems like it goes too far. It reads a lot like when Hollywood fitfully tries to cash in on gaming with an underresearched movie with a premise about going inside a video game. It ignores the possibility that developers might make games that don't fit into this model, and fails to recognize that all games shouldn't be the same.