I believe that a large portion of how the market has changed from generation to generation actually represents the age and lifestyle changes of the first generation of gamers.
At the end of the generation between the SNES and Genesis there was a large and growing population of gamers who were older than Nintendo and Sega were targeting; although Sega tried to be "cooler" and appeal more to teens, neither the Genesis nor the SNES really tried (hard) to appeal to gamers over 15 or so. This gave Sony the opportunity to target gamers between the age of 13 and (about) 21 with the Playstation by producing a system that focused more on their interests (sports games, 'cinematic' games, and "Mature" games); the PS2 targeted a little older with its focus on multimedia capabilities but still maintained this core target.
I suspect that the Wii is so successful because it has (once again) transitioned into an older group of gamers, who grew up with videogames, have children (or at least responsibilities) and are far less worried about graphics as they are with fun.
