idd, optimization does not push graphics over the hardware boundaries. You just optimize by cutting features and elements that aren't needed and using cost effective graphical options like MLAA vs MSAA or 720p vs 1080p. Same thing that can be done on any game on any platform. The fact that the consoles are allready going sub 1080p/60FPS doesnt paint a picture of them being too powerful, I would wager the OPs setup is plenty enough powerful to compete.

Ram will guarantee very sharp textures whole gen (that is if developers want to spend time and resources to work on them, current game dev-cycles are too short...) and the games wont be constrained experiences compared to this gens consoles, though.

How do you plan to use this PC with no operating system? No keyboard and mouse?

Think you should wait a bit, R-200 family is just around the corner, that will cut current prices a bit (though it seems most of them are refreshed 7xxx anyway).

Exactly what I was thinking. Nobody is able to build a ps4 or xbone for less than 600. The value is ridiculous, regardless of which one you get.

If you want overclocking you should look or a more expensive PSU I think.
Cheap on the Case side?

+ I would add keyboard+mouse a big plus.
- Not optimised for games a minus (that is the consoles are optimised - that's the talk and they shoudl be)
- Need to upgrade is a minus
+ Need to build it yourself a plus

A billion dollars worth of exclusive games is what you should tell him. Developers is going to get high off of Microsoft's money.

Can't play the many console only games on PC, and you are missing parts, like the OS for one.

i see the possiblity to upgrade as a + not a -

Most of what you said isn't realistic.

PS4/Xbox One will also have shipping costs, depending on where you live or how you're going to buy it.

About the OS, Linux is free and the gaming library is growing every day thanks to Steam support(it's already bigger than PS4/Xbox One).

You're right about the KB+Mouse and the HDMI cable, but I'm quite sure everyone has a few of these somewhere, except if you never had a desktop PC or any current device that uses HDMI connections.

About trading, it's possible, if you buy physical discs and depending if the game box says online activation isn't needed(there are many games released without the need for it). Every PC game is supposed to be optimized for KB+Mouse, every racing game works with 3rd party racing wheels natively and almost every current game(since 2006, I believe) has native support for the 360 controller, and you can easily map your controls natively in most games so it also supports 3rd party controllers(and even Wii Remotes, depending on the game). You're right about the other stuff you said, altough overscan can be easily worked out via the GPU control panel.

Most of what you said is far from convenient. Installing Linux and living with limited game  support, using KB+Mouse on the couch, hard to find physical pc games in stores, configuring controls and getting incorrect button prompts, fixing overscan and small font issues.
My point is that for less money you get all the convenience of picking up a console and games in a store and it all works directly after plugging it in to your tv. How is all you suggest giving ps4 and xbox one a run for their money.