Yep, I agree.  I mean, I look forward to playing Metroid Prime 4 in both modes - 1080p/120hz and 4k/60hz.  But if there was a third option for, say 1440p/60hz but with enhanced graphical elements (e.g. better lighting or effects), I'd almost certainly take that over the other two.

Have tried 120 FPS and it looks EXACTLY the same to me as 60 FPS. You must have weird sensitive eyeballs!

It isn't the look, but the reduced input lag and superior controls.  Competitive gamers aren't running high fps for no reason.  

I"m a normal gamer, not a 'competitive gamer'. 120fps is a waste of resources for me.

Even with normal gaming higher fps results in more responsive and accurate controls.  It factually isn't diminishing returns.  Personal preference doesn't change this.  

Sorry but as I can't see a difference between 120fps and 60fps then it IS a waste of resources to me. Not everybody experiences games the way you do. The vast majority of gamers are absolutely fine with 60fps and better graphics rather than 120fps and a downgrade in graphics to make up for the frame rate increase.

Diminishing returns specifically relates to human perception. A character model with 1billion polygons objectively has 1000x more polygons than a character model of 1million polygons, the point is an average person cannot discernibly perceive that difference/

Sensitivity to lag and input response varies a lot between people, I've never been sensitive myself but I mostly play single player games... Then my brother said he doesn't like playing Smash Bros on the TV because of more input lag. There objectively is more anytime a image gets transmitted to an external source, I've just never in my life noticed it. There comes a point however where across the spectrum of gamers, the vast majority cannot detect that extra 10-20ms of lag. 

This stuff is also conditioned, so naturally console gamers are going to be especially less sensitive.

Vast majority can't tell a difference? Any data? Or just claims based on personal preference?

Meanwhile here a published scientific study demonstrating benefits at 90 fps compared to 60 fps.  

https://d1qx31qr3h6wln.cloudfront.net/publications/Tokey_NOSSDAV_25.pdf

Diminishing returns past 120 fps. Sure.  But objectively the average gamer does in fact benefit above 60 fps.

I am usually fine with 60fps, even variable 45-60 fps with VRR. A locked 40fps is also fine for me in most games.  I have a 240Hz monitor, but still max out graphics to a 60fps target most of the time.

The big exception is Virtual Reality. The higher the resolution and framerate the better when it comes to VR, imo, because otherwise I get horribly motion sick. 

Can't do VR at anything under a locked 75fps, and only start feeling comfortable >90fps. 

If VR ever became big, a lot of the current rendering trends in games would be entirely different. Most games probably would still be forward rendered with no temporal AA/upscaling and minimum FPS probably would be a solid 75. 

We'd still be talking about MSAA and the like.