Regarding game sale on the iPhone, they're already quite big. There is some programmer who developed a crossword puzzle game for the iPhone which is ranked around #39 in the iPhone charts. Now she revealed that she is selling more than 400 copies per day, which is more than 12.000 copies per month. [1] Going by this, iPhone games that have reached the top 3 or top 5 so far will already have sold more than 100.000 copies each. Pretty good for only 3 weeks of sales!
[1] http://www.macrumors.com/2008/08/01/iphone-app-store-numbers-reveal-large-revenue-opportunities/
Hardcore gaming is a bubble economy blown up by Microsoft's $7 $6 billion losses.