No, it just means we have more variety now, that the market has broadened, that there all kinds of games for all kinds of people to enjoy. You are like someone who enjoys zombie movies getting mad because someone made a vampire movie for those who enjoy them. You are exactly like someone who wished Nintendo didn't exist because they don't like their games, even though millions of people DO like their games. You should be taking a good look at your own opinions right now and why you are making them. If graphics were all that mattered to all these people you are so happily demeaning, things like Minecraft, WoW or Wii Sports (among many others) wouldn't have been massive hits.
About this whole visuals vs fun thing... just because someone enjoys a great soundtrack or appreciates good camera work, doesn't mean they didn't enjoy other aspects of that particular movie or that they don't or can't enjoy other aspects like the story, characters or dialogue. When it comes to games, it's the same: every aspect adds to the whole experience and people play games they are excited about, regardless of the reason.
You are literally saying that only those who enjoy what you enjoy can be considered real gamers and everyone else is a cancer to this industry, and that's just wrong on so many levels. It also makes me think about all the games and experiences you may have enjoyed but you didn't because you considered them to be part of this "cancer" you talk about. Gaming is supposed to be all about harmless fun.
Hardcore gamer is someone interested in gamming the most, of course, that ditches out of the group those who play for other reasons. It's not that I'm trying to seem a better person than them or anything, it's just that they're not hardcore gammers.
You talk about Minnercraft, WoW or Wii Sports. The first one is a "create your content" that has always sold at really low prices.
WoW it's a game that's losing players every year, which means that the young audiences don't care about those games anymore.
Wii Sports was all about the movement, and it attracted a casual crowd that now is gone.
If you look at what those games are, you will understand well why I'm saying what I say.
Regarding the variety thing... no, just no. This past generation has been shooters in first and third person, and sports games. Other than that, the JRPG genre has been nearly dying and will die this next gen, the SH was also killed and the few quatily beat em up's that were released (bayonetta) were such a failure that had to be funded by Nintendo in order for them to survive. Seeing how this is shaping, they won't make it past this gen either.