Right.. but the problem is that "the long run" is very much dependant on what's going on right now. Developers are seeing that PS3 is not selling and will either stop supporting it or convert exclusives to cross-platform (already happening a lot). So that hurts Sony in the long run, even though Blu-ray has nothing really to do with that *there*.
Really, blu-ray is the biggest problem I see. Without blu-ray they'd still have a lack of games, but the system price would drop so dramatically that people would buy it out of the "well PS2 was good, I'm sure they'll have more stuff coming" mentality. Thus systems would sell, developers would stay on board, etc. I think the price tag is a huge factor that's blocking that right now. People want to know they are getting value when they slap down $600, and PS3 is not providing that.
But we'll see. I personally hope they fail just so Sony learns some damn humility. They have been so egotistical lately that they really need to be knocked down a few pegs.