Hmm, to answer the thread title, power doesn't always mean a better game. It's more so a piece of the whole part to making a great game. It also depends on the game. Not all games need a large amount of it to be great. I suppose it's a matter of scope. More power can be used to make better things, but it's not the most important.
Now the other question, more powerful hardware I feel also depends. It could used to make larger, more impressive games, but I don't think it's important and something we need now. I kind of feel focusing too much on that could limit innovation somewhat.
Dance my pretties!
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