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The gap is not getting bigger, in fact it was getting smaller until MS dropped their price. PS3 is still too pricy in a world where recession has hit many homes and this has made the 360 more accessible to gamers. Neither console is going anywhere fast. 360 was selling better, then the ps3 was selling better and now the 360 is selling better - both are selling well.

games -
1) well the larger the install base, the more they will sell.
2) LBP is a Niche game unlike Gears and Halo
3) Unlike Resistance; Halo and Fable have a huge fan base from the previous gen.
4) Resistance may have been good when it came out, but not many casual gamers were happy since the graphics were naff compared to Gears. So now they doubt the new r2 will be worth buying.
5) Sony hyped a lot of games (heavenly sword, haze, lair to name a few), but reviews as well as some of the hype. So now many gamers doubt if Sony games are really what they are hyped to be. Unlike the 360, most games apart from too human did live up to the hype.
6) Sony marketing has been shite compared to 360 marketing.

Where you make a mistake is thinking they have won the war. many people do not realise how well the PS3 is selling with its current price compared to the 360 who should be killing the PS3 with the price differential. The question remains, what will happen when and if the PS3 drops by another $100's and becomes more affordable?

Sony have also failed to release any games that have a big fan base. Games such as; GT, Jak and Daxter, Dance mat games, a new PS3 Wipeout, GoW3, Onimusha and twisted metal.

Those games that could have made a difference; GTA, Devil May Cry, FF, tekken and maybe some more have now gone multi platform. meaning, if you are a gamer who can't afford a PS3, you need not worry, a cheaper console is out there who can play the same game!