The main problem that I see with your argument is that it assumes prices will always stay high for digital when all evidence shows that as something becomes dominantly digital based, it becomes cheaper and has more frequent sales.
Right now, with the 360 probably being somewhere around 70/30 or 80/20 in terms of physical/digital copies sold, the digital copies are already close to the same price as buying new copies that aren't on sale at the store. For instance, I bought Darksiders on demand about a month ago and it cost me $20, which is about what it costs new at retail (give or take $5). On top of that the 360 has been having increasingly large and better sales as the push for digital is becoming more apparent. Every few weeks there's at least one or two retail titles that go on sale for much cheaper than retail (for instance, last week, Dark Souls was only $10 on demand).
When a digital service starts out and is heavily in the minority of sales, it is more of a luxury and the publishers will charge more than retail. But over time as the amount of digital sales outweighs the amount of physical sales, those digital titles will become as cheap if not slightly cheaper than retail and there are more and more deals on those digital titles.
That is why I am fully confident that as consoles become mostly digital based, we will see decent prices, and sales a plenty.







