After reading this, I have to say, I would pay full price (Waving my employee discount) if Bioshock 2's intro was like you described. I, personally, love the interactive cutscene mechanic. Even if I have to sacrifice realistic 'Wow' quality graphics, I want to move my arms, legs, head, eyes, and hell, give me a button that lets me fart at the most inappropriate times -- and make sure the people in room are aware of my gas attack. Taking this launch, I'll proceed to share my thoughts on immersion.
Take a page from acting: what makes a good actor good? In a film, as well as on stage, when something happens, they react to it. EXAMPLE:
"Hi Bob, long day at the steel mill, huh?" says Jack, handing him a mug full of beer.
"Hell. Yeah. That jackass of a boss made me stay an extra-" Beer mug bumps into the cigarette lighter and tips over, spilling onto the bar, which is completely not in the script, "-ah shit, Jack. I'll get it." says Bob, taking napkins from a luckily placed prop.
"I'm all thumbs," says Jack, passing him more napkins and shaking his head in silent shame.
"Anyway, that jackass had me stay an extra hour. I'm not even getting..." etc.
A good director will keep scenes like that, whenever possible, because they slowly bring about that illusion that you're becoming apart of some period of these people's lives.
Games need to do this more and more. Have the other characters have little secret meters built into their code that fill and empty based on my actions. Pretty simple, right? I fart, guy likes me more slightly, women likes me less. Other women likes me a lot more (scary), only I have no idea. Eventually, these meters can color the responses I get and even create new ones. I continuously fart, the guy may break out into laughter and tears, while the first woman may openly scold me and insult my hygiene. The third woman may propose coitus. Now, throw this handy game mechanic into an interactive sub-cut-scene, where I have full control (or new controls) while replacing a boring CGI story moving cut-scenes where I get to see bad cgi acting, worse voice acting, and we've got ourselves a great story-telling medium which inspires that age old 'fun' emotion.
PS, I know game developers use Metacritic as a measuring stick for their progress, reading reviews to find out how they failed. Why isn't Yahtzee ever listed in a Metacritic report? Some of the other sources are just laughable, and they aren't trying to be funny. They should contact you once in a while. Or me. Contact me instead.