There are several reasons for people switching - one is the cost of the equipment, a good PC able to play demanding games may cost easily 10 times as much as a PS3 or X BOX. Even if you own a good PC, as I do, the game may not play at all or the protection could damage the PC or some part of it.
Sorry, you make several points there that are not true.
a) PC hardware cost might be double or triple the console cost to play AAA games, but absolutely certainly not 10x. A PS3 will cost say £250 (don't know $ costs, I'm in a UK sterling territory), a decent PC will cost £600-800 (I've never spent more than that in the years I've been playing) ... there's certainly never any need to spend £2,500!!
Even with the 2x/3x multiplier, you get more flexibility and functionality for your money than just the games machine anyway.
b) I've never had a AAA game fail to play altogether, although patches and driver updates aren't unheard of, of course. Xbox 360 and PS3 and Wii all download updates online too, which suggests strongly to me (as a professional programmer), that there are bugs and game issues to be sorted out on those platforms too.
c) "the protection could damage the PC" -
actually cause
damage ... not very likely. Be a cause of security issues and un-warranted disclosure of data to monitoring web-sites perhaps. But what do you think Xbox Live is? It's a form of online protection
and (most importantly for the vendors) a way of seeing who is playing what and when. (Not singling out MS here, I just can't remember what Sony call the PS3 equivalent, and I'm not sure that the Wii Channels work the same way)