Fun and challenge aren't the same thing.  Just because it's challenging, doesn't mean it's fun.  Not all horror games are about shooting zombies or running away from supernatural bosses (which doesn't really sound much like a horror game).  Think about Five Nights at Freddies when I say that horror games don't have to be "fun."  Five Nights is challenging, but the only thing you do is move left and right, check the cameras, and open and close doors until the time is up.  Some people might play for the sense of achievement, but that again isn't the same thing as fun.  Some people play it for the "horror" experience.  

Also, just because there are other means of experiencing horror, doesn't mean people would just skip out on video games which are infinitely more accessible than a horror house or a carnival, and watching screamers on YouTube isn't nearly as much about the experience.

I meant to get back to this much sooner. So here goes, while I don't see in the interview where he said what is in the title I'll respond to that first.

Video games can learn plenty from movies. From the simple of color lighting, sound and effects there are many thing that can be learned.

Movies went through some major transitions, adding sound, then adding color. Those significantly changed the way movies are seen and viewed and made. In that case though, almost all movies are now with sound and color. Only someone trying to go for style or a time piece take one or both out.

Games have had some transitions as well some of the earliest are mostly gone do to the user interface being an issue, you don't see games now where you have to type in what you do, you can control the character to do it.
Other transitions are more just expansions 3d games didn't put a stop to all 2d games.

Storage media allowing audio big enough to have voice actors, didn't mean all games without it were gone. Though it did allow some games to be more immersing.

Better graphical capabilities allowed for more beautiful characters environments enemies and effects. Not all games put them in but so many benefited.

Many of those improvements benefit from things learned in the making of movies.

Enough on that though.

Things that he said that bothered me. "I have never though of games as a means of Storytelling"
Maybe there are things missing here or lost in translation, but the fact it while all games don't have to tell a story, games can be an amazing means of storytelling. In some ways one of the best because the player can be involved with it making it happen and not just watching it happen.

The part in there about the director making the movie and him wanting to make the player the director. That just makes little sense to me with many of the games he's made. The player in most games is an actor not a director some open word games allow more of a feel of director and some games where the player is actually creating the levels and world he really is.

His line about people trying to make names for themselves seems odd to me when so many of those that are aren't doing it with the stories but with there indie games.
If he thinks that the market is moving towards more narrative driven games he's missing the onslaught of the mobile gaming market. As well as missing that many of the best selling games every year aren't being bought for the story, but for people to shoot at each other online. Or play sports. Those are much more focused on gameplay than story.

"Making films in the past was something that was made with a completely different skill set but now I feel that it's rather similar.” - Shigeru Miyamoto
http://www.independent.co.uk/life-style/gadgets-and-tech/gaming/nintendos-shigeru-miyamoto-premiers-pikmin-short-films-at-tokyo-international-film-festival-9820643.html

So with that said, could we all stop now with the title and putting word in his mouth?

I'm pretty sure thats what he meant, read the previous pharagraph from that qoute to get more context on what he was talking about. Try to read it as a whole, the first paragraph(below) is very important to get the understand what the qoutes mean. He didn't say anything against deep stories in games and he was not talking about cinematic techniques.

He believes, in film, storytelling fall in the hands of both the director and creator (not the audience). In games, storytelling is a split or shared role, hence  says the player(audience) is the director, and from that we can say game designer is the creator. That explains why he was horrified when asked about what developers can learn from film making, because he doesn't believe developers should both be the creator and director

That also applies to the what he says about young devs making a name for themselves, I think a good example would be The Order 1886, https://www.youtube.com/watch?v=jgW-_ZH2STI, it goes like this cutscene-playerAction-cutscene-playerAction-cutscene-and so on, in contrast to Miyamoto and big N games which goes like this: cutscene-playThoughEntireLevel-cutscene/or next level, interruptions are far in-between.

From the article:

...In films, he explains, the director and the creator are one and the same person, dictating what happens, carving out the story’s arc. But in games, he believes the director should be the player – his job as a designer is simply to equip them with the toys to direct. As a creative philosophy it’s pretty much the opposite of auteurism – though ironically, it’s one that has made him the best-known games designer on the planet.

“These younger game creators, they want to be recognised,” he sighs. “They want to tell stories that will touch people’s hearts. And while I understand that desire, the trend worries me. It should be the experience, that is touching. What I strive for is to make the person playing the game the director. All I do is help them feel that, by playing, they’re creating something that only they could create.

While talking to Miyamoto, you realise he’s as much a discoverer as a designer. Like Newton or Einstein, he has found something fascinating out in the world – in his case, fun – and then dove in between its cogs and springs, working out the rules that govern it.

When I ask him if he thinks the games industry can learn anything from cinema, he seems mildly horrified at the thought.

“When you play a game, one moment you’re just controlling it and then suddenly you feel you’re in its world,” he says. “And that’s something you cannot experience through film or literature. It’s a completely unique experience.”...

Also, about the director and actors, the director tells the actor what to do. If think about it that way, i think it would make sense. The player/director controls the actor/character.

How people are responding shows how many people looked at the title and failed to read the actual article..

Miyamoto isn't wrong but the fact is he hasn't really made a lot of unique or great pushes directly with his own games in a while. He comes up with some great ideas, but most of his games now have something of a one trick pony feel, compared to games where he advises but someone else is clearly in charge and the main force such as the Mario 3D Galaxy/Land/World games or anything by Sakurai and his Sora group (Smash Bros games and Kid Icarus: Uprising).

While there are some Miyamoto touches here and there (maybe) those games are usually packed with content, while you see many with Miyamoto's large influence or direction , probably due to his larger role with the company beyond game design, are more barebones (the original Luigi's Mansion, the Wii series and NSMB series). One can only hope the demos that he showed off for the Wii U at E3 if they become full games don't wind up being like that as well... especially in regards to Star Fox.

The player is the actor, with the limited amout of freedom the the director/the game/game creator give you. Stray to far from that direction and you have to do it over. Stray to far in another and you won't progress until you go back to follow what you are directed to do.