Games cost as much as they do to cover many expenses incurred by the developer/publisher. These expenses include, material, developers, artists, advertising, taxes, licensing, shipping, etc Simply put, games cost what they do because developers enjoy eating, as do most of us, you know I hear it's good for the longevity. You pay more for PS3 games because they're on blue ray disk mostly.... why for xbox360? I don't know except in the cases of 3 + DVD
In addition, console makers(Nintendo, Sony, Microsoft) charge fee's, except in some big situations where fee's are waved, to the developer to release the game on said system, and some developers buy their Dev kits. Newer console is more expensive to develop for pretty much regardless of the scale of the projects.
