You're very wrong. Someone did a complete cost anolysis of Xbox over PC and found that after 4 years an Xbox was the same as an $800 PC. This is going to replicate the major parts.
Assume PC is $800. Reasonable price. We're not going to include monitor in that because we'd have to include >=720P HDTV with the Xbox, and that would make it START more expensive. We are including mouse, keyboard, etc though since we're including cables for the Xbox and assuming it's the hard drive version. I'll be nice enough to leave out the $100 wi-fi adapter (rofl -- those are like $5-$10).
Assume Xbox starts at $300 (incl hard drive, yadda yadda, cables, any other wanted accessories)
Every year you pay for LIVE, yeah? We're anolyzing four years and XBL is $50 a year.
That's $200. Xbox has gone from $300 to $500 already.
Now factor in the games. New Xbox game = $60. New PC game = $50 (usually).
That means that to equalize the price you only have to buy 30 Xbox games ( ($800-$500)/$10 = 30 ).
That's less than 8 each year for four years (30/4 = 7.5)
And this isn't counting things like the original Modern Warfare or Team Fortress 2 where PC gamers got the paid DLC for free.
And even if you get games from bargain bin / sale I can guarantee you PC gets better sales through Steam. Right now MW2 is on sale for $15. Sale prices still have to take the console maker's license fee into account. That $~8 fee doesn't magically disappear during the holidays.
If you use Xbox Netflix, make sure to add the extra fee into the console costs. Microsoft charges you extra on top of what Netflix charges, so lump that in with LIVE, but leave the actual Netflix price out (assume PC Netflix if Xbox Netflix is added in).
You're paying for a gaming PC. You just don't know it because you've been nickel and dimed by Microsoft over the course of years.
Admittedly Sony's platform is a much better choice assuming you don't opt for PSN+. You have an extra 20 games to buy before it achieves price-parity with PC.
tl;dr: You can't use cost as an advantage for consoles. Unless you're talking strictly Sony (since it's also a Blu-Ray player).
And no, I don't care what someone plays on. Just don't pretend it's cheaper by ignoring more than half of the system's real cost.