But... why should the hardware sets be locked? If you just hooked PC's up to TV's and made games for them, everything in your vision would come true, and people would not have to buy both a PC and a console :)

Because PCs are not easy enough to use here. They're not plug and play devices, you need to worry about if a game will run on certain hardware or just how well it will run, and then you have to keep your drivers up to date, worry about malware and the like.

This is one of the reasons we have consoles in the first place.

It's just impossible for Companies to rely on minor hardware differences to give their console the edge over another. If that's their only advantage, then they will push for bigger hardware changes obviously which will then lead to consoles specs being different, also leading to development cost being different. Game capabilities end up different. Publisher then getting games to utilize these differences [cause if they don't then there's no point in having them of course], then end up back to where we are now. 

I just don't see how this could possibly work in this day and age.

One approach to the one console standard, but multiple manufacturers, is to go the 3DO route and that didn't prove viable.   The other approach to one console is to have one maker so dominant, that they don't think of anyone else.  If you see what happened with Nintendo from NES to SNES, or Sony with the PS3, you see why that isn't good.  In the case of Nintendo, they ended up mangling Mortal Kombat.  In the case of Sony, they had the PS3 launching at an insane price point.  Does one think the PS3 would be priced where it is now, if Microsoft wasn't around to cause Sony to feel what last place is like?  You would likely looking at $400 MINIMUM for a console, if there was no 360 about.

All and all, one console strategy isn't going to happen.  Companies will be too greedy to end up having this happen.  Someone else will enter.  And as for being able to play everyone anywhere, well, the locking people into a network where they have to own a console, is what is banked on.  Sony, while not charging for online play, is banking on people just playing others over the PS3.  And "Only on X" is still a viable strategy as far as gaming goes.  Apple also employs this to.  I don't see them, anytime soon, opening up their iPhone technology to multiple manufacturers.

Flat out, you want to have this dream?  The closest one gets is a PC.

Well, the idea is that the hardware would be overseen by a board or committee of some kind, so we avoid instances where the hardware becomes so different that developers need to accomodate it.

Well, the 3DO did have some handicaps.

1) It launched at $699.95! 700 bucks! And that was more than $700 today, because of the state of the economy!

2) No first party developers, and so it had to rely on third parties.

3) The market has expanded significantly since its launch back in the SNES days.

I think that if this approach was to be revisited, it could be made to work, but not without a good launch price, and it would certainly be a big boost to have one of the big three with it to add some high quality games to its library.

Iwata said something along the lines of when Nintendo stops making videogame hardware, they'll stop making videogames period.  And they won't ever commit to a format they can't retain control over, they consider hardware a means to an end and working on someone else's hardware would provide fundamental obstacles to their internal development process and culture.

Sega, Hudson and SNK's falls from grace when moving out of hardware paint a pretty cautionary tale... 

Policies can be changed though. And Nintendo still would have a hand in the design of the machine, plus they would be in complete control of their controller.

Sega, Hudson and SNK are probably good examples of companies that fail to adapt in that case. I don't know the situation with their developers though, maybe some talented people left, I don't know. But some developers can still make excellent games for machines that are not made by their employers, loads of developers are proof of that in this day and age, and Nintendo should do fine, even if they don't have 100% control over the hardware anymore.

Locking in people into a certain platform, like you do with the Mac, insures a degree of profitability for a console.  I bring up the 3DO because the licensing model they set up ended up offloading all the costs of the hardware on the manufacturer, while the standards company got a cut of the licensing fees.  End result was the console was as expensive.  If you think this is just 3DO, and is a simple issue, you got the taste again with the PS3.  The manufacturers have to be able to recover costs down the road for their hardware investment.  In the case of Nintendo, freed of the high def arms race, they produced a marginal upgrade to the Gamecube, with a new feature they added, and did it for a profit. 

As far as "no first party" goes, who is first-party in your model?  You propose something like a PC model for this, and the closest thing to that is Microsoft with the PC.  Well Microsoft has found moneyhatting third-party is the way to go.  They have a few studios, but not a lot.  Think DVD player manufacturers here to.  There is no first-party in the area of DVD manufacturers.  What you find is with this universal standard (to remind again, that is what 3DO pushed for) content makers and hardware makers tend to separate as time goes on.

The market has expanded a lot.  Do you think it would expand under one uniformed standard for hardware?  Do you think Nintendo would of done the Wii and pushed motion-control if they didn't control the hardware?  It is because they did, just like the 3DS, that they push innovation in ways not normally done.  They are built on controlling the hardware to meet their ends regarding what they want to do as far as games.  And this approach has led to greater variety.  An issue you have with universal standards and one platform, is that one one really goes and markets the platform itself, unless it is like Microsoft doing it with the PC, because Mac was gaining marketshare.  Also, in large markets, you find more competitors jumping in, who would undermine what you say.  I have learned this trying to get a non-profit involved with promoting abstract strategy games.  The supporters of different abstract strategy games see themselves as only interested in themselves.  They will NOT work together to get all interested in things.

Ok, let me tackle a bit regarding your two issues, of access to a game, and also play online, again.

First, regarding a title produced and distribution, you do have third-party companies that have their own dev environments which enable them to create games and easily port them between platforms.  They then will look to also distribute digitally, over the Internet.  They get their games on platforms that are not compatible, without worrying about the environments, because the dev work does it.

In regards to playing whomever, besides it offering console makers a competitive advantage, it would take the likes of a Blizzard to strong-arm the console makers into agreeing to allow World of Warcraft on all platforms they want to be on, to connect together.  Of course, this is presuming that there is a drive for EVERYONE to want to play everyone online.  There are more fundamental issues of screening out strangers who are jerks that isn't resolved.  No one has found a solution to this bit of human nature.  Myself, I don't really play online with others.  I don't have much of an interest other.  For me, I want to play with good people I know, who are friends.  Multiplayer boardgames is of greater appeal than online.  Play random strangers?  Well I do Game Room on my 360, and I get to play whenever for high score in challenges.  It works well.  Not sure how going beyond the 360 would help here though.

Hardware design is fully integrated into software design though, that's core to Nintendo and core to their recent resurgence.  Systems like DS or Wii wouldn't have happened with the scenario you're proposing, and it literally runs counter to Nintendo's own R&D.

People from Sega have commented before on how much turmoil their development went through in the 3rd party shift, Naka and Suzuki especially iirc, and how that loss of intimate know how with the hardware fundamentally damaged their R&D process and demoralized their teams.  When literally EVERY company who goes out of hardware "fails to adapt", maybe you should start questioning why exactly that is?