Consoles are not cheaper.
I've spent probably... $1200 total on PC parts for my setup near the beginning of this console generation, including my monitors, all 3 of them. It's not amazing, but it far exceeds the recommended specs for new games today even though the hardware that matters is a couple years old now.
My console gamer friend has purchased a Wii, when it was new. $250.
Purchased an extra Wiimote and nunchuck thing. About 40 bucks.
Purchased an Xbox 360 at launch. $400.
Purchased extra controllers. 50 bucks at the time I believe, so 100 bucks total.
Purchased a PS3, the 60gig backwards compatable one, at launch. $600.
Purchased extra controller. Again, about 50 bucks.
A couple years later, due to the power supply on the ps3 failing and it no longer being under warranty.
New Ps3, 40 gig version. $400.
That's already a total of 1840 dollars, over the course of the last generation alone.
I've bought for my PC: A new Motherboard, a quad core processor, and 16 gigs of ram, and a 750 watt powersuppy.
Cost of all those, about 350 dollars.
Bringing my total to about $1550.
If I include the TVs he had to purchase over the generation as well the cost would be nearing $2500 for the consoles.