Sure, I don't disagree. I could probably narrow my definition further. My point is really just that if one looks at what "game development" was understood to be ten or fifteen years ago, those methods and forms of development are still gloriously alive today -- just not in the production of high-budget AAA PS360 games.
Seriously, you're absolutely right. I guess that what I was hinting at is that "high-budget AAA" games today really are "high-budget" games, which entails high risks and, judging by most 3rd parties' losses, diminishing returns. Also, it seems that those AAA HD games are usually seen as ambitious and serious as far as game development goes. They're seen as what small-to-medium-sized developers should aim for when they "grow up". This perception of resource-demanding, production values-focused games as the be all, end all of game development is what led me to take a shortcut and call them "traditional games", even though, as you said, other forms of game development are alive and kicking. This was lazy phrasing on my part, and in the end, we're in agreement.