1. Art is a flawed term to use for gaming, just as it is for movies and litterature. By using the word "art" I believe people actually mean something else. Something which is harder to summarize with just one word. I believe what they're trying to say is they want games to be deep, sincere, atmospheric, narrative and emotional. But that's not art. I think it would better be described as 'sophisticated'.
2. No matter what we call it, even if we would call this characteristic 'art', the OP is wrong in his claim that games have become more mainstream and that developers chicken out instead of innovate. It's just not true. The proportion between 'mainstream-generic' games to 'original-innovating-emotional' games has not evolved towards an increased number of mainstream-generic games by time. It's actually the other way around. In the 80's it was all Pong, Karate, Pac-Man or shoot'emups. The 90's brought us a steady flow of deeper, story-driven emotional games and they've been here ever since in an increased ratio.
Like so many others, the OP is suffering from a memory disorder which is called nostalgia.
