Hehe. You said "logic".
This is valid when we're talking about a manufactured good with a material production cost. The manufacturing cost of a single copy of a console game, sold in a store, shrinkwrap and all, is pretty small. I don't know the exact numbers, but it can't be much more than a couple of bucks, especially with the cheap 2-3 page black and white manuals that have shown up in the game boxes lately. The manufacturing cost of a digitally distributed game is zero. In both cases, there is a fraction of overhead, in terms of distribution, marketing, etc. While a whole lot of people will buy games at $60, there are a significant number of people who will not pay that much for games. Just as there are a significant number of people who won't pay $30 or $40 for a new hardback book.
When you price things at "impulse buy" level, you sell a lot more. When Steam has one of their huge sales, people start buying up tons of games that they otherwise would not have bothered with. I spent well over $100 on games during their sale this past summer - money I would not have spent on games if not for the sale. A few hours of entertainment that may or may not be good is really only worth about $15-$20 for me, and that's pushing it. Gambling $60 on the chance that a game will have enough content at a high enough quality to keep me interested for a couple of weeks or a month is just not going to happen.
Books, music, movies, and games are all competing for our entertainment dollars. Whoever provides the biggest value for the money generally gets the sales. For me, that value is reduced the more the item is restricted. I used to buy a lot of books, but paperbacks are increasingly inconvenient for me, and an e-reader would be the perfect solution... except that those e books are usually saddled with DRM or are more expensive. Computer books, such as those for various industry certifications, have always been expensive, but when the electronic version is even more so, it's just insulting.
If I could find a large selection of $5-$10 novels that interested me in electronic format with no DRM, I'd be buying them up. But right now the value proposition just isn't there to justify the initial purchase of a Nook or Kindle.