From discussion with other devs, such as Factor 5, most HD development starts at 10 mil and for a AAA title can go up to 50 mil on average. Wii development generally runs 3-7 mil in comparison.
The developer, if they are using a separate publisher, will receive a VERY small amount of money. The publisher generally fronts the money for development in a traditional scenario, and the developer sees no royalties until the publisher recoups their money. So if the developer gets $30 of a $50 game, and they spent $30 mil for the development process, that means that after a million copies sell, they will break even. Of course, the publisher wants a bigger net income for their investment, so they set the actual turnaround number higher before they have to pay the developer royalties. So they might need to sell 1.5 mil copies, or 2 mil copies before the developer gets royalties, and even at that point, they are small - maybe 10-15 dollars on a 50 dollar game.
In the end, the developer gets money to pay their staff to make a game, and whatever extra they save is what they actually bank. Otherwise, most development studios are paid only to exist and make a game, rarely to profit from it. This is where indie development pays off.
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