I agree with the OP in many ways. JRPGs have failed to modernise on consoles for the most part. I think the problem actually stems from back when RPGs diverged into the JRPG and WRPG. In some ways, what KylieDog says is true, WRPGs have stayed truer to the spirit of the traditional RPG more than JRPGs in that they offer the player much more choice and influence.
JRPGs on the other hand incorporated incredible stories and during the SNES and PS1 days, they were really the only place to get a truly good story in video games. The problem now is that they have competition, not just from WRPGs but from many genres. Even a few FPS's have engrossing stories that can rival JRPGs for depth and quality.
Unfortunately, whilst other genres are offering competition on the story front the other aspects the make up JRPGs haven't evolved. The battle systems can still feel archaic, the worlds are not as involved as other genres (they feel static), the level of interaction is limiting and when you have games where the environment feels alive, the limitations only serve to break immersion.
The only JRPG on consoles I've enjoyed this gen has been Xenoblade Chronicles, and funnily enough it wasn't for the story (which was nice but nothing ground breaking), but the world, the originality and the gameplay. I hope others take note next gen.
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