Note: Developers only have 7gb of space per disc for their games on the Xbox 360. 1.5gb of the space is taken up with "security features", or something of the sort. This puts both the Revolution and the original Xbox at an advantage to the Xbox 360 in disc space terms. While the difference between DVD-9 and Blu-Ray (7-1) is not as large as the difference between CD and cartridge (10-1), it's still a significant difference, and this issue was enough to almost single-handedly destroy the N64, when Nintendo was the previous market leader by a large margin. With that in mind, what's it going to do to a company that's not even the market leader? Time will tell, but the facts are overwhelmingly against the Xbox 360 in this instance.
Even if you just want to ignore all of the developer comments about this issue, it's still plainly obvious that disc space requirements jump significantly in consoles every generation, and this is even more true in the coming generation, because of the leap to HD resolution, as well as 7.1 surround sound and higher audio quality. History is an excellent example of what to expect when it comes to disc space requirements, and when in videogaming history has a newer console ever had less disc space than its older counterpart? None that I can remember. While it is unfortunately for Microsoft, the developers and the people buying the system (including myself), it's not entirely surprising that those who wish the system success (including myself) are talking down the issue. However there's also some of us that refuse to blind ourselves to reality by pretending the issue doesn't exist, because quite clearly, it does. I, as with anybody else buying the system, can hope that these 15gb discs are released to alleviate some of this problem.
I'd also like to point out that the days of CGI sequences are not gone, not by a long shot. While real-time rendering quality has certainly improved dramatically in the next-gen consoles, it's still far below what's possible in pre-rendered sequences. Even if the developer chooses not to use pre-rendered sequences, some of the real-time cut-scenes must still be recorded and played back during the game, to avoid flow-stopping loading times. Xenosaga is a perfect example of this. Pre-recorded (but real-time) cut-scenes were in heavy use, because the cut-scenes took place in many different locations throughout the game, and loading times would have killed the directorial flow of these scenes. The game ended up being 2 DVDs. As for “real-time is just as impressive as pre-rendered, if not more soâ€, don’t be ridiculous. If you think they’d have been better off showing Advent Children in real time, maybe you should have taken your idea to Square before they blew millions on their pre-rendered work.
Your comparison to PC games was interesting, but it doesn't exactly prove what you wanted it to. The fact of the matter is, console games take more space than PC games... significantly more space, because of compression and streaming issues. Take GTA3 for example. The PC version is about 500mb installed, but the PS2 version is nearly 6 times that, and at half the resolution! Now with console games rivalling PC games for resolution, what's that going to do to the disc space requirments? Suddenly 6x becomes 10 or 12x the space. In other words, comparing PC games to console games for disc space just doesn't work, unless you're trying to prove that console games will always require more disc space than PC games, even if they're exactly the same game.