This thread is where we come to complain and dissect the failures of the industry, and fantasize about what could of been. It could be a developer, a publisher, a console manufacturer, the gaming press or even us, the consumers. You can consider this a spinoff of NintendoPie's Why do you like Nin/Son/Mic thread.
I'll start us off with the PS3.
I think the biggest mistake Sony made with the PS3 was, by far, t3h c3ll. The R&D and manufacturing costs for this thing were a nightmare, and from a business perspective, a completely idiotic move on Sony's part. It was hyped to be the second coming of processors and put Playstation years into the future, but what actually happened is it was bottlenecked by the limited RAM and comparatively underpowered GPU in the PS3, meaning it's full power will never be achieved. And even if developers can get past some horrendous architecture and cleverely optimize for it, the results are hardly ahead of the competition if at all.
Let's imagine that Sony never developed the Cell, and went with a similar processor in terms of power to 360s, this leaves the PS3 $100 cheaper and in much better shape to face the competition. Sony had the brand power at that point to release a console $50 to $100 more than the others and fly by the 360 and maybe even the Wii, but $200 more? That's just insane. And even if Sony wanted to be at the bleeding edge, noticeably more powerfull than the 360, they could of done that without the Cell easily, and more effectively. Keep a similar processor to the 360, double the RAM and use a slightly better GPU in the PS3 and it would still be $50 cheaper than a Cell-included PS3, not to mention the hundreds of millions that would be saved in R&D costs.