Ubuntu, Fedora Core, and most specifically Yellow Dog Linux have all spent some of their time ( =$ ) making a distro just for the PS3. They set up software repositories for it, and gave users the traditional vast amount of control.
It was too good and Sony shut it down for possible piracy risks.
If these companies negotiated with various console makers, (Sorry 360), as to what permanent OS crippling is necessary (no admin priviledges, reduced repositories, evil etc...) there could be a good amount of money in it.
Console makers gain new features, Linux gains new users, people make money for something they spent time on, and controls can remain compulsory.
This was done on the PS2. Notably, it is not being done now. Does anybody know why that is?