Original Comment by: Rob
http://www.citystate.co.uk
Good, thought provoking article. You do rather skirt around an important point in painting your picture of an industry jilting the past: in the general case, on home consoles, old-style 2D stuff just doesn't sell very well. (SCEA's anti-2D policy doesn't account for the paucity of 2D stuff in other territories and on other platforms, f'rinstance.)
And yeah, sometimes genres get cut off in their prime by the industry at large chasing the next big thing, but all the ones you list had been wrung dry for a long time before they were abandoned. With IF and point'n'click adventures, devs had done every puzzle they could think of at least twice. Overfamiliarity had set in among the audience. (And FMV was always a dead end, obviously.)
Genres typically have a finite lifespan. Occasionally you can get a Frankensteinian final burst of life out of them years after the fact, where developers freed from worrying about the technological constraints of the genre's heyday can go nuts, but these last hurrahs don't go on to make the genre sustainable again, at least not in a worthwhile way (see: the constant retreading of Metal Slug).
Also there's the issue of whether abandoning a genre means abandoning all we've learnt in terms of mechanics applied to that genre - it feels more like an incremental process to me.
You're spot on about the needlessness of ever-increasing game length. And that the imminent industry-wide embracing of downloadable content will furnish us once more with a 'form factor' where small, quick, simple games make commercial sense. (Not sure where Manifesto Games factor into it on the PC side though, seeing as thousands of companies are already out there selling small games, and one more aggregator angling for a cut isn't going to cause much of a ripple. -- (Prove me wrong, Costik!
)
So in summary, I don't agree with the the whole of the route you took but do agree with the final assessment.