You seem content. So... OK I guess.

I mean I don't really see what Steam has to do with console gaming. A lot of PC gamers wait to buy games because they know Steam will have big sales eventually, but that has very little to do with console gaming since console manufactorers can't do sales like that. 3rd Parties will never allow it. 

If one does not buy the game at 50$ (initial price), but instead gets it at 5$, or for free, would that not hurt the dev economically in the long term?

A lot of people do think like that, myself included, Why pay for Little big Planet Vita when I can get it for free? Well, guess what? I've waited for a year and a half now and still no LBPvita for (EU) ps+ subscribers. You simply don't know whether a game will be offered as part of the ps+ service, so gamers will keep buying games.

For that to happen ps + would have to be more mainstream than it is. Your scenario could be very far away if it indeed happens. Consider that your scenario only applies to gamers on playstation. This situation is not mainstream at all. In any case, Sony is investing and preparing for the future digital gaming services. Steam has been very successful.

Speaking of DLC, I got gravity rush for free and recently bought all 3 DLC's available for the game. I'm sure I'm not alone.

I like to think and plan ahead. Sometimes far ahead. Yes, those prerequisites are still away, but one day we may find them at our doors. And guess what: as is the nature of most changes, it will come smoothly, slowly. We may not discern the reasons of its arrival.

Eh. Worst case scenario, Videogame consoles become a subscription service like Netflix and Hulu.

Outside that, steam and PC games seem to do amazing in an environment where most people don't buy first day.

Yes. I've seen that prediction before.

I am not sure if this or steam sales will crack the industry but you can't ignore the fact that how low the profit margins must be with these ps plus freebies. I mean for a smaller dev to get exposure makes sense but giving away one of the biggest games of 2013, just few months after it came out. That really doesn't inspire confidence in the product. 

People always love to resist whenever someone brings negative news for the industry unless that said news is related to one particular company. The company that manages to sell their products at close to full price for years.  Anecdotal evidence but i've seen people on forums saying things like i'll wait for the game to come to plus. Unless it is a big game that they just can't wait to play (GTA5, etc) most would be okay waiting out a bit. It must factor into consumer's buying decisions, given the fact that most gamers have some kind of backlog already. 

Heck i paid $15 for a new copy of Bioshock Infinite (PS3) and i feel that i paid too much now. PS Plus is excellent for the consumer but if you are a publisher, it really is diminishing the value of software. It's magical how razor thin the profit margins are getting for companies. Thus, they want a constant stream of dlc and microtransactions for the people that bought their game. 

Cheers.