Thing is consoles have always been cheaper than computers, fact of life. Even today you wont get a PC tower for $200 able to play Gears of War in DX10 like the 360 runs it. Also console games were always expensive. Sony were the only people to make an effort by cutting 20% off the list price for their own 1st party titles. But in 1988 or whenever Genesis games here were double the price and the machine was 200 bucks. So...after 10 game purchases your Sega Megadrive here works out more expensive in the long run. I think the NES was something like 40 bucks a game here, compared to 10 bucks for a C64 game, and the unit was only about 50 bucks less. No wonder Nintendo UK failed with the NES, the games were nothing special apart from a few 1st party franchises.
Ultima VII: PC DOS game: 69.95$
etc. etc.
PC Games that didn't suck were just as expensive as console games....
The majority of "budget" C64 games were all piles of crap, as compared to games like Castlevania, Contra (the C64 version is a travesty to all of mankind)...... the games were definitely better....
I don't see how lending someone a couple of disks to boot up in an A500 was harder than lending someone a cartridge. It's not like a PC where you need to mess about with himem or xms/ems and config.sys etc. Pop the disk in the drive, plug joystick in, play game. Not really sure how anyone who has experience with a Amigas can make such a crazy comment.
Its simple, loaning out say 3-4 floppies to your friend opens up worlds of possibilities of problems. "Oops, I dropped them", "oops, spilled shit on it"
"Oops saved over it", "Oops, I crunched it in my bag", etc. etc.
Cartridges, you have to be pretty stupid to damage. Floppies, kind of flimsy.
It has nothing to do with ease-of-use.
Sound wise there is a radical difference between the FM chips in a Genesis/TG to the 'do whatever you like' 4 channel DACs on Amiga. Sure you get more sound channels, but it is a trade off. You wont get anything as exquisite and unique sounding with the diversity of the MOD archives compared to stuff which always sounds like the FM sounds of a Genesis.
First, there is no FM chip in the TG. You should listen to more FM stuff. Alot of it is pretty smooth, and often even sounds cleaner than sampled stuff. Add in the nicely blended sound effects, and you also have a better arcade-like experience over all

.
It just seemed that companies in the USA lost interest somewhere between the high priced A1000 launch and the revised A500 two years later. There seemed a lot of initial enthusiasm which waned after time. I think that is down to Commodore in some ways, the A1000 probably wasn't the right machine to launch as a sole product, the A500 should have been first out the blocks for about the same price as an ST with mono monitor of $799. This would have been discounted down to about $700 or less and is not far off the 1987 price of an A500 anyway. Perhaps then interest would not have waned in the first 3 years in the USA.
What happened is, IBM took over businesses, working folks got used to them, IBM ended up in the home, DOS had some nice games.... shareware ensued, Windows happened, VGA went wild, DOOM appeared, etc. etc.
edit : I would be interested to see sales figures for the Sharp x68000 machine compared to NES/Megadrive sales. The x68000 is pretty much the Amiga for Japan, a computer with console quality games. So I wonder how well that high priced machine sold compared to cheap and cheerful console for 1/4 of the price.
It sold amazingly well, largely in part to the fact that it is also a computer, and as such you should compare its figures to the PC-98 or MSX instead of a video game machine.