Its not really a GPU but a video chip, defeniatley far far behind the Gamecube and Xboxes GPUs who were used in the PC space as well. Even the Dreamcast GPU was stronger.

The overheating issues are also blamed dueto the CPU which made most of the heat. CPUs are in general reliable and cant break that easily, but they can cause a lot of heat dueto bad design which can result into defect motherboards or GPUs

The question and the post don't match each other at all. I'm not even nearly qualified enough to tell whether x86 is better than the alternatives, but I know for sure that development costs have been rising for a long time (probably since the beginning). The reason is simply more powerful hardware, which enables more advanced games, which in turn require more people to work on them, which costs a lot of money. Whether x86 was a better choice than say, PowerPC, is another question, but familiarity is definitely a factor that should reduce the costs. Now that there's only one architecture to master instead of two (last gen we had x86 for PC, PowerPC for consoles), the situation should be better unless x86 is vastly inferior, which I strongly doubt it is.

So, to answer the question, at worst x86 is probably not much worse than PowerPC, but at best it could be a lot better. Reality is probably somewhere between those two ends.

The current consoles mainly suffer from choosing such poor x86 cpu's, not the fact that they went over to x86. So my hope is that for Nintendo if they choose ARM or x86, that they make a very capable combination of cpu and gpu that allows developers to create games with the least amount of bottle necks as possible. 

Number #1 did happen. It just also happened to be the case that games became more complex as well. #2 has happened, the performance issues of current gen PC ports are nowhere near as bad as the 7th generation pc ports. 3. Also happened with respect to the predicted development times. 4. Didn't happen, but also wasn't predicted. #5 is probably the biggest effect. 

Before I address 6-11, I'd like to say that the PS3 is a perfect example of why X86 as a standard architecture was needed. The PS3 was very gimped by its unique and specialized architecture. 

#6, this is for market reasons. The video game market is not a perfectly competitive market, so there is no reason why P(price) = MC(marginal cost), video game producers have market power and can control prices. Not to mention inflation, $60 in 2006 is about $70.57 in today's money. 

#7, the same was true for the 7th generation. 

#8, It seems to me that optimization of the consoles occured much sooner in this generation than it did in the 7th generation. I don't see there being huge improvements in graphics left for the PS4/XBONE, while the PS360 had some huge improvements in their last few years. The consoles are just weak. 

#9 Mostly because there are fewer games to migrate from PC to consoles than there had been in the past. Most games are multiplatform while at the start of the 7th generation PC had many more exclusives. 

#10. There is no way around this. Development costs are ALWAYS going to increase until we have a huge breakthrough in programming design or hardware power. 

#11. Seems to be mostly a Japanese phenomena, and this is an effect of they not releasing games in the 7th generation. Otherwise, the market is pretty healthy. 

I think than rather than the architecture and/or technical/artistic problems developers face we have to take in consideration that developement times for big name studios are bat shit crazy even with the best tools and employees. This makes them cut corners in order to get to the deadline because now the market expect a super production game every year or so.

Well it is morning in my part of the world. The OP that yesterday late night to me seemed to be a rather neutral and objective observation, is in reality not very neutral or objective!
I thank everyone that could see trough the language and respond to the question I tried to formulate.

I would say that at least one of the benefits is that there is not much discussion about bad ports od 3rd party games. In PS3/X360 era, the quality of some ports were very poor.

Going to X86 architecture did not help at all in relation to mobile gaming, which is mostly on ARM arhitecture. Mobile device volumes are staggering which makes it attractive for developers. Still today the console games are far bigger and complex than mobile games despite the fact that the raw computing power of mobile devices is closing up on consoles.

PC gamers might disagree with there not being crappy ports. given we have a unified architecture between PC and Xbox/PS one might wonder why there have been high profile crappy PC ports.

Graphics and optimization are huge part of the budget. Which is why low budget titles don't compare to the average $60 game. Games have become cheaper when you consider inflation. They have stayed $60 in spite of $60 being worth less.

That has more to do with programing and games have become more complex. Expecations from say 10 years ago are very different today.

A lot of games are pretty well optimized given the hardware. Buying a PC with equal specs is more expensive. We now have significantly better graphics and performance on 8th gen consoles, so maybe you're missing the obvious.

More games are coming to PC because its becoming a more viable market. That has a lot to do with developing countries as well. Its worth noting popular PC genres like MMOs and MOBAs are becoming more relevant on consoles.

Big budget games existed in previous gens as well. https://en.wikipedia.org/wiki/List_of_most_expensive_video_games_to_develop

Mobile games are generally low budget and less risky, but that certainly isn't where all the money is at. Which is why there is still a huge focus on console gaming. That's just a different market and generally a different audience.

No. x86 isn't cheaper to manufacture.
Typically x86 die-sizes are massive compared to say... ARM or MIPS, heck probably even PowerPC (I haven't checked, can't be bothered either).
Die sizes have a direct relationship to production costs as you can fit less chips on a wafer and you get increasing amounts of failed chips due to yields.

Older fabrication nodes can also be cheaper than newer fabrication nodes as well due to maturity and the insane costs to retool fabs to something newer, Nintendo's "old" 45nm PowerPC chip is probably cheaper to produce than Jaguar... Up to a point. If you intend to make a 5~ Billion chip, then 45nm would be more expensive than 28nm.

However x86 reached a point of "good enough" due to the focus of smaller more power efficient chips for Small form factor PC's (Think: NUC, Tablets, Netbooks etc') that was never available in any other prior console generation and those smaller chips, whilst still more expensive than ARM, was offset by combining the GPU into the same silicon.

Internally AMD and Intel x86 is RISC, externally they are CISC.

The CPU heat added to the GPU heat, it compounded to the issue.
The PS3 CPU had issues related not to heat, but that's another discussion. :P

Bang on.
AMD's CPU's are woefully inadequate, have been for a few years now. (Anyone who buys AMD in 2016 is nuts in my opinion.)
AMD's fastest are barely capable of beating Intel's low/mid-range parts, take AMD's slowest of the slowest (Console CPU's) and you come to the conclusion that CPU wise, these console are laughable.

It's not x86's fault, but rather AMD, they stagnated and fell behind, hopefully they can make up for lost ground with Zen.

Still. With that said... An 8 Core Jaguar is still superior to that of Cell or Xenon, it's more efficient, it's faster and easier to develop for, would have been nice though if console manufacturers took CPU performance seriously for once though, we would have better physics (Without needing to rely on the cloud), A.I. etc'.

1) Development is easier, faster as less work can be done on inferior dev kits and instead be done on high-end PC workstations.

6) Cost is likely never to come down, only increase, Publishers want to make their Billions on re-released games every year.

7) Allot of that is because of deadlines/financial issues, rather than x86, lots of internal politics at Studio's/Publishers.

8) They are optimized... But if you had noticed... This generation has allot less "baked details". (I.E. Shadows/Lighting details in the textures) instead it's all dynamic, consoles caught up to PC on tech, this costs allot of resources to pull off and is often seen as a loss of optimization, when really it isn't, more is certainly happening on screen.

9) I wouldn't say games are migrating anywhere.

10) The easiest way to increase your sales is by increasing your Audience so you can afford higher development costs. - The PC has the largest gaming Audience and games have longer legs in terms of sales, so it makes financial sense.

11) There is billions to be made in Mobile, developers only have finite resources, if they can't compete in the console space, then they should refocus on where they can make money, they are business's, blame the consumers for not supporting them. :P

The thing with mobile is that App's and Games aren't really built for the particular hardware nuances, they are built for the API's/Software stacks, which is also part of the reason why x86 Android tablets/Phones can run the majority of the Android software ecosystem. (With the help of Binary translation too.)

Mobile is quickly evolving, but they are still nowhere near the consoles.
It's not like they can have a 250~ watt GPU backed with a few Gigabytes of HBM/XGDDR5 Ram to fuel their 1080P-4k resolutions in games, it will take them a good 5-10 years for them to get anywhere near the PS4.
Not only that... But high-end devices don't typically sell in great quantities, the majority of Android devices would still be slower than last generation consoles, which most developers target their games and software at.

It would solve allot of Nintendo's problems, especially with 3rd party support, developers are less likely to ignore it if their hardware is compatible with the other 3 platforms (PC, Xbox One, Playstation 4) on a technical level.

Nintendo has a bit of an uphill battle though, for one... They need to stop attacking Youtubers, who ironically help advertise their games and consoles.