There's a reason, but that's not it.
yeah sorry, i didnt intend for my second sentence to relate to my first. it was a late night of typing! 
Take a PC with equal specifications to the Xbox 360. Add Windows. Add the trillion background tasks and applications running in the background. Now, tell me which one is going to perform better when running demanding games? The fact that the Xbox 360 is still home to industry leading graphics and games shows that the available hardware is still quite able.
lol. i love how you have to create thoroughly ficticious situations in order to make a (bad) point. im sorry, but i have no intention of buying a 1.4 celeron in 2003 in order to test your hypothesis. and consoles have never ever had "industry leading graphics", lol. console textures are the ugliest thing ive ever had the misfortune to see. my 8800 has more power than an entire 360, why you're arguing about graphics is beyond me!
hell, current gen consoles are incapable of running higher resolutions than i was playing with 10 YEARS ago.
Considering the best independant titles, sucha s Braid and N+, are available on Xbox Live Arcade due to the ease of programming for the platform, I can only label this statement as incorrect. Would the 360 be more capable with 4gb of RAM? Of course it would, it's simple maths. The point is that when faced with finite and limited Hardware, console developers often create very innovative solutions to programming problems. So many PC Titles are simply unoptimised because they can just bump up the Spec Requirements on the side of the box.
lol, 2 titles don't refute my statement. the indie market is PC centric. look at the sheer number of (mostly crappy admittedly) titles released every year. far more than your 2 examples i can promise you. i agree, console developers do a pretty wonderful job of fitting everything they need in the limited hardware resources. but that doesn't mean they fit everything needed, which is why multi-platform games too often limit the PC version to what is capable on the consoles.
There's a difference between dumbing a game down and deliberatly developing inferior visuals, sound and in-game content to allow the game to perform on inferior hardware, which is what you're insinuating. Considering titles like Gears of War 2, Modern Warfare 2 and Uncharted 2 are grabbing headlines with their visuals, it's safe to assume this practice is not industry standard.
again, console games look like arse. i don't know why we're even having this argument. yes, such titles might wow those comparing them to other console titles, but they look like shit compared to what is available on PC. its simple mathematics.
"dumbing down" can meet either of your statements. i tend to use it like i mentioned before- less content, less options, less complex gameplay. supcom is getting dumbed down, quite obviously. as i said previously though, im not blaming the 360 for this. i blame chris taylor and his goals of reaching a bigger audience. forged alliance is too awesome a game to be as popular as more accessible titles.