Are you sure we're talking about the same game industry?
I am not saying I WANT or would play said game, but that level does not exist in these games.
Star Wars the Old Republic (the KOTOR MMO) gets pretty dark if you roll dark side. There's also torture, shooting innocents into the void of space, and a few of the class stories let you kill a lot of people for no reason other than that they're no longer useful to you. It's a bit campier than GTA but I can't think of any other RPGs that model being an real asshole quite so well. SWTOR is actually kind of an interesting example because it has EA and Disney behind it, even if the latter joined on after-the-fact and invalidated the canon the game is based on.
Spoiler alert, but one of Far Cry 3's endings sees you murdered after climaxing during sex, all in first person.
Hardly chaste, if you ask me.
Yeah I would describe GTA as pretty tame compared to those movies some of which have broken through to the mainstream. The average horror movie is more violent and gruesome than even the worst we see from video games.
The Witcher and Mass Effect? Those are adult games with very lame sex scenes all of which are consensual. I don't see that as particularly scandalous.
Part of the equation is that combat is interesting to simulate. It has clear rules ( live or die ), a lot of different ways you can tweak the game design to differentiate ( swords vs guns vs spells vs karate ).
The most popular games are NOT that violent. They simulate combat, but the draw is the competition created by the simulation, not the blood and guts. I can't name a game where "chopping people up" is the primary goal. I'm sure it exists, but I would find it dishonesty to disparage an entire medium because of the work of some niche game developer.
I didn't grow up during a time when you could go out and wander the streets all day and your parents would be OK with that. You had to be home. Having friends over and competing over video games was a great way to pass the time. The game we played the most? Super Smash Bros. Rated E, 0 realistic simulations of violence, about as bad as any slapstick film.