Heh... shmokes replied while I was preparing mine...
I agree 100% with what you said, of course we basically said the same thing.

I think I found of a good example to put things into context and it mirrors EXACTLY what is happening to the Kinect. The NES Zapper.
The NES zapper was heavily backed by NOA upon the nintendo's release. It was even promenantly bundled with the console. There were bundles that didn't include the zapper though and the gamepad was the primary controller that was included with every nes, bundle or no.
The zapper was praised by critics and gamers alike because of the potential it had, and everyone expected it to go far.
Initially get got two top tier games directly from nintendo, Duck Hunt and Hogan's alley. Things were looking up... until the third parties decided to give it a go.
The third parties were scared to fully commit to a controller so they optionally supported it, with the zapper support being far worse than the standard gamepad (Operation Wolf), made it a secondary part of gameplay that's basically forgettable (bayou billy) or just ignored it completely.
Meanwhile, Nintendo was struggling to figure out what to do with the device besides shooting targets on the screen. They experimented with games like gumshoe, but ultimately a standard gamepad would have been more efficient.
Then then started to waine support themselves, going for the optional route (balloon fight). Eventually they stopped making games for it and the third party developers did as well.
In the end you have a dozen or so games with partial support and a handfull with full support. Out of that handfull, only two or three are considered to be good.
This is EXACTLY what is going on with the Kinect right now..... Microsoft's first-party lineup has been really short and really limited. Thrid party support is either supplimental to a a gamepad game, shoddy, or non-existant, and everybody is trying to figure out just what the heck a 3d-camera is good for game-wise besides full body tracking, which isn't as useful as it sounds on paper.
Now of course, the sales are larger, but these days consoles sell a lot better, and of course 74 is a lot bigger number than a dozen, but this isn't the 80's when you had hurdles like quality control and getting a game burned onto a 80 dollar cart to overcome. I mean hell, fruit ninja was originally an ipad game.

My point isn't that the Kinect is a terrible controller, far from it in fact, it's just that it's a specilized controller that isn't the default controller for the console, and those almost never do well.