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Of course hind sight is 20-20.

I am more concerned with what Sony is going to do with the PS3's sequal. Either it is going to be very expensive again, or it is going to need to be launched very late...

That true. It pretty obvious now $600 is too much (maybe even $500) for a console.

As far as PS3 sequal if HD really doesn't sell and most people still have SD TV later on then why do you need a sequal the start with? Do you really need anything more powerful to run games in 480p? As of now it's the Wii and it's game that's on top. If PS3 is profitable it will clearly be in the long run.