No, videogames are clearly headed toward increasing sophistication, and perhaps some day they will be worthy of the title "art". It's just that right now the potential for interactivity is laughable, as CPU limited as we are.
Why aren't there any great painters from 10,000 B.C.? How come you don't see any great silent movies from the 19th century? The answer is obvious - technology. People of 10,000 years ago made drawings - but they were crude images made with low quality dyes or etchings scratched out in stone walls. The technology to make a painting into a work of art was not yet available; surely there were cavemen with the potential artistic talent, but at best their creations were crude, limited by their materials. There were moving pictures in the 19th century - but they were tiny, jerky, and limited to a few minutes in length; there simply was no potential for artistic storytelling through them. A silent movie can be a work of art, but not when it's a tiny-screened, 2-minute strip of film.
In terms of expression through the creation of virtual worlds, we are in the same state now as caveman painters in 10,000 B.C., or filmmakers circa 1890. The technology to express emotion and creativity is simply not there. Just look at computer gaming AI. No matter how hard the developer tries, they behave totally fake. Human players quickly pick up on the quirks and inconsistencies of programmed AI, giving the lie to the illusion and showing the ugly, boolean-governed heart of computer logic. No one will ever mistake a FPS bot player for a human player, let alone believe a computer-controlled NPC to be a living entity. The interactivity of worlds is terribly stunted and minimal. And that's because we are limited by our technology. The most powerful CPUs in the world cannot realistically simulate a living being, let alone thousands of them interacting in a virtual world.
Yet, who knows what the future will hold? In 20, 30, maybe 50 years, we might be seeing amazing works of art through computer-generated imagery and truly interactive, immersive, imaginative worlds. But to extol current-day computer games, hobbled by the limitations of memory, processing power, and graphics card, to extol these things as "art" is an exercise in self-deception.
(just trying to inject some humor... oh well)
