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PS3 doesnt cater to the casual market, so they wont be able to overtake Wii sales. That said, a PS3 around 250-300 would do phenomenally with the HDTV owners, if not only for a cheap Blu Ray player.

The issue at the forefront of the matter is the developers that have distanced themselves from PS3 development. Even if the PS3 became the behemoth seller, it would still take those devs to commit to developing for the PS3, which would take 2-3 years. In other words, the developer shift wouldn't hold impact until 2012, which is an agreeable timeframe for the next gen systems to come around.