sure the crash was significant but in the opposite sense of what the OP is talking about.

Nope Sega had that area covered. Sega would most likely be following the path MS/Sony are if they where still in the console market as thats the market Sega was already targeting.

Storytelling was already growing in the SNES days.  See Final Fantasy IV, VI, Chrono Trigger, etc.  Yes, the PS1 was the first dedicated 3D console but that's less an accomplishment and more of an inevitability, that's where technology happened to be, Sony didn't invent any of that.  Worth pointing out as well, the industry pre-PS1 wasn't just surviving, ut was thriving and growing.  What little sales data we have from pre-FFVII PS1 vs N64 sales show that had no PS1 been made, Nintendo would have had an exceptionally successful generation as most of its partners stuck around rather than migrating to PS.  The Saturn also may have had a substantial boost from some devs migrating there.  Point is, the Playstation is historically significant for its sales numbers but not in the way of massive influence compared to systems like the NES that truly changed...well everything.

It may have been an inevitability, but somebody had to start the 3D console era first and then run with it.  But more than just the hardware, developers were stepping up their games in other areas as well and consoles and video gaming had started to be looked upon as more mature with the PS1.  Developers wanted to try and see how far they could push everything from the looks of it.  

Story telling was getting better with FFVI, but past some select moments in FFVI out of the games you mentioned, the writing still needed padding out.  There were too many moments that were in a hurry to get to the next scene and rush the narrative along without really having the impact that some of the games on the PS1 had: Xenogears, FF7,9, and Metal Gears Solid come to mind the most.  No Sony didn't invent any of that, but neither did Nintendo (besides maybe Earthbound, but that game didn't bring many people interested into it unfortuantely)  in the SNES days.  That was pretty much just Square.     Then Metal Gear Solid was born and brought a new standard of voice acting that had never been heard before.  We could actually feel heavy emotion now with voice acting rather than hearing stuff like "Set us up the bomb!"  Resident Evil 1, 2 and 3 brought about the survival horror genre and completely redefined horror in video games.

All of this leading up to more cinematic games as the generations went on.  They're the AAA games we see now 3 more generations in from the influence the PS1 brought, take them or leave them.  As far as I can see, those games are going nowhere.  Nintendo still has their market as well, but it's different and usually isn't at the forefront .  The Wii was an explosion of a casual trend that died down, but Nintendo did have an idea they might have been able to run with further. We'll have to wait and see how the Switch does in the long run.

It may have been an inevitability, but somebody had to start the 3D console era first and then run with it.  But more than just the hardware, developers were stepping up their games in other areas as well and consoles and video gaming had started to be looked upon as more mature with the PS1.  Developers wanted to try and see how far they could push everything from the looks of it.  

Story telling was getting better with FFVI, but past some select moments in FFVI out of the games you mentioned, the writing still needed padding out.  There were too many moments that were in a hurry to get to the next scene and rush the narrative along without really having the impact that some of the games on the PS1 had: Xenogears, FF7,9, and Metal Gears Solid come to mind the most.  No Sony didn't invent any of that, but neither did Nintendo (besides maybe Earthbound, but that game didn't bring many people interested into it unfortuantely)  in the SNES days.  That was pretty much just Square.     Then Metal Gear Solid was born and brought a new standard of voice acting that had never been heard before.  We could actually feel heavy emotion now with voice acting rather than hearing stuff like "Set us up the bomb!"  Resident Evil 1, 2 and 3 brought about the survival horror genre and completely redefined horror in video games.

All of this leading up to more cinematic games as the generations went on.  They're the AAA games we see now 3 more generations in from the influence the PS1 brought, take them or leave them.  As far as I can see, those games are going nowhere.  Nintendo still has their market as well, but it's different and usually isn't at the forefront .  The Wii was an explosion of a casual trend that died down, but Nintendo did have an idea they might have been able to run with further. We'll have to wait and see how the Switch does in the long run.

Other, went with the original PlayStation, as it basically kickstarted the modern video game market. NES second for me, just as it didn't push teh market's popularity as far as the PS did.

https://en.m.wikipedia.org/wiki/PSX_(digital_video_recorder)

Are you talking about something else? The only info I could find on the PSX says its a peripheral for the PS2, so not even a console. 

Sorry, yes, I mixed up the numbers. My main point stays: that the numbers alone don't say anything about significance.

The first movers are usually a tiny blip compared to the market if properly covered. The first movers have to test out things, establish for customers that the possibility for this type of product even exists and so on. That is why first movers usually don't seem to be big in hindsight. But the 350K sales for Odyssey were more than enough to prove that a market for home gaming systems is sustainable. That was the important part.

And Atari on the other hand - it came into the market together with a lot of other contenders. Not only fairchild. 1975 and 1976 saw a lot of new contenders. Without Atari one of them would've been market leader. To be precise: the first Atari-system (Home Pong) sold only 150K and was outsold for instance by Colecos Telstar. 1975 also Magnavox discontinued the original Odyssey- but for a series of Odyssey machines (Odyssey 100, Odyssey 200 and so on). Ataris sales champion 2600 was really late, it started in 1977. So it is easy to see, that Atari could've been replaced easily. Also the game that pushed Atari a lot was Pac-Man, a licensed game. Someone would've probably done that. I would assume without Atari Coleco and Magnavox would've fought for market leader, but that is speculation.

But while Atari could've been easily replaced, without Ralph Baer and the Brown Box (that became the Odyssey) the market would've been created at that point. Atari, Coleco, Mattel, Fairchild - they all tried this because the Odyssey showed this is possible. Without it it would've taken years and at that point would've been met with serious competition of PC-gaming. Console gaming would look very different.

I guess my point is, you are crediting Sony for what, from what we can tell, was a thing already in motion.  Square was already becoming more and more sophisticated in their writing, Konami had already started moving that way with Metal Gear 2: Solid Snake, etc.  Sony was in the right place, at the right time, with the right business strategy.  If Sony had stayed out, all this would have happened in some form on the N64 and Saturn.  Especially if we assume a direct off shoot of history at the turning point and say Nintendo DID partner with Sony for a disc-based console.  But even if it stayed cartridge based, developers would have just worked around it.  The industry was already headeding in that direction. 

That's what I'm saying, Sony capitalized on what was already being done vs actually causing a revolution like the Xbox (or the 360 in some people's opinions) that initiated the online gaming phenomenon, or the NES which changed the whole way the console business was approached after rebuilding it in the US. 

We have no idea what could have been in the future you're thinking of.  There's too many possibilities.