As to the OP's original question, "Will Microsoft lose the hardcore fans next gen?"
It depends. If Nintendo gets serious with the 3DS and Wii 2 about working with 3rd party devs to create awesome Nintendo games, then both Microsoft and Sony will be at a loss.
I don't see this happening though as previous posters have pointed out that 3rd party developers are in it to make money and the best way to do that is multi-platforming your game as much as possible.
I think what we will see next generation are multi-platform games for Nintendo, Microsoft, Sony and PC. What we have this generation is big budget 3rd party titles split between Sony, Microsoft and PC.
I don't think 1st party titles are that much of a draw anymore compared to having a console with a large library of software. Metal Gear and Final Fantasy may get you a few extra buyers, just as Halo and Fable will, but if you are banking on 1st party at the expense of a large library of games to entice all types of consumers, then I believe you are making a mistake.
