First, not all arcades had their games crammed together. Most arcade owners who knew a bit about "marketing" would place new games near the front of the arcade, in positions where you DID see the art. Passers by would notice. (At least I did).
Elaborate side art, bezels and control panels enticed players to play games that were rather "blocky". It got your imagination going so the blocky graphics in-game had a context.
You have to also remember that upright video games were EVERYWHERE, not just in crammed side by side in arcades. You could find 2 or 3 in corner stores, malls, bars, bowling alleys, etc. All sorts of places where they stood there with side-art fully visible.