For them, buying twenty copies of UT2004 to play over LAN for one day is ridiculous (and a serious rip-off). But, buying UT3 or CS-Source over steam to play people around the world is 100% ok!
Exactly. To take it further, the best "investment" I ever made was buying half-life. I played it for 8 years! Not because it had the best single player (I haven't even finished it, one day I will!) or multiplayer experience, but because of all the amazing mods it had. I suddenly found that the game was really 15 different games.
It's the same with Starcraft & Broodwar, I had played it for a couple of years straight, and yet every so often I would install it and waste a good hour or two on tower defense maps (the original).
Looking more at the games that I own, it seems multiplayer games are the only games that would sell. But then there's also Civilizations 4 and Galactic Civilizations II, which I never played online but still play extensively today, and it tells me that probably majority of gamers only buy games that offers high replay value or unlimited hours of gaming.
And I remember Portal (2-6 hours), The Monkey Island III, and Final Fantasy 7 which are all relatively quick games but I still bought and thoroughly enjoyed, even if I only played them once or twice.
And though there are plenty of copies out there for the said games I mentioned... most of my friends, cousins, and I still bought legit copies (even when we were teens back then and had no jobs).
Maybe it is a money issue... but maybe more importantly, it's the value of these games. If developers/distributors want to convert these 'pirates' into customers, they should polish their games and show some passion to their customers/communities.
E.A. for example, and in my own experiences pirating their games, are notorious in releasing unfinished games. Their games don't make it easy for modders and don't bother listening to community complaints. Suffice to say, I even stopped downloading their games off of torrents.
A pirate, paying for nothing, refusing to even look at their products.