Not necessarily, especially if marketing is slowly rolled out in the right manner. Hit one show one month, another the next, and so on. The games and demos right now DO show what the system is capable of when it comes to multiplayer. Whether GAF wants to believe it or not, most people don't buy systems because of the graphical capabilities. If that was the case the Wii would have been a huge failure. The majority of the sales for this system is going to be the same people who bought the Wii and that's who they'll market towards. I'm still guessing they'll lock up some exclusive to bring over the hardcore in the future, but that's not who they're going to go after right away--there's most likely 2-3 years before we see another system from MS or Sony.
Of course E3 is needed for the next publicity blitz. That's a given.
Also, where in the world is this talk of "Don't market too early!!!!" coming from. They advertise movies and television shows a year in advance and that doesn't hurt them at all. It gets it into the mind of the consumer.