One great example is SpaceChem. It's a joyously frustrating game that revolves around "programming" reactors to create molecules from other molecules. The joy of finishing a level (particularly if you can beat the curve in terms of time/instructions) is tangible.
Don't despair too much at the state of the game industry, just don't look to the "leaders" for your interesting games.
Taking the rose-colored glasses off, a large part of the adventure gaming genre (including point-and-clicks) relied on obscure object interactions or guessing the right command to proceed. Freeing a bird to drive away a snake in Colossal Cave Adventure is not necessarily intuitive.
For some people, including myself, this is fun. But it's not an easy, thoughtless, escapist form of entertainment - which is where the modern FPS comes in.
I know there have been some efforts to do that sort of thing with a text-adventure-y environment (Storytron?) but don't know of anyone who has really gotten it right yet.
Even the base concept of challenge is not a given in modern gaming with titles like Little Big Planet where creating games is a major focus, or Kinectimals in which atmosphere and light hearted play trump all (actually, that second title could use even less, 'forced' challenge, IMO).
I applaud modern developers for constantly pushing the limits of what it means to 'experience' a game, rather than just play one as we have in the past.
That said, Zork totally rules! I've always thought there was room for Interactive Fiction in the modern world, it's just a matter of how/when (I hope!).
There is room for interactive fiction. The community of interactive fiction writers didn't grow quite as quick as the community of professional and hobbyist video game developers, but they're among us. You may have heard of Andrew Plotkin and his runaway Kickstarter deal: http://money.cnn.com/2010/11/15/technology/kickstart_plotkin.... If you haven't played his games, do yourself a favor and take a look, there's a javascript interpreter, so you don't even need to download anything: http://eblong.com/zarf/if.html. Dreamhold is the easiest to get into; Shade and Dual Transform are both single-room games, but each provides wonderfully peculiar game mechanics.
If you want go get a perspective on the present state of interactive fiction, http://brasslantern.org/ is a hub of sorts, you can find game files and reviews there. There are annual competitions. If you use iOS, there's a port of Frotz interpreter.
It seems that the shitty movies are pretty much only the single-player ones.
I think at their best, video games do better than "shitty movies". If someone made a list of "Top 10 Moments" from film & video games, I'm betting Aeris' death at the hands of Sepiroth makes that list.
Since I've heard about Aeris being killed by Sepiroth before, I went ahead and watched it on YouTube, and I wasn't impressed. It must have been because I didn't play the game. If that scene affected you at all (if it looked like anything but cheesy crap animated with expressionless plastic dolls) it was because you were prepped by playing the game to experience that scene in a particular way. You can watch a clip of "La Strada" or "Midnight Cowboy" or "Unforgiven" or "Casablanca" out of context and at least get a sense of the emotional dynamics of the characters. That's the strength of movies. The strength of games is the immersion and feeling of personal involvement with the characters, personal involvement driven by your own actions, choices, and sacrifices. I may have felt like Ratso Rizzo was my friend, but I never picked up a john to get money for a bus ticket for us to leave town together. I may have shared Rick Blaine's feelings as he put Victor and Ilsa on the plane to Lisbon, but I didn't decide to do that. It just happened to me.
Games will always be second-rate next to movies when it comes to presenting scripted drama, but they don't have to feel that way. Aeris and Sepiroth is proof of that, I guess. Gameplay allows games to affect us in ways that movies can't and enables different and stronger emotional contexts for experiencing games as art. The art of games is in the gameplay. Detaching from gameplay is just a crutch, like filming a stage production, copying another art form because we don't understand the new one well enough yet.
The example I've always use for how gameplay can make a scene more emotional is the end of your first battle in Shadow of the Colossus. You know your main character has been tasked to slay these massive creatures to bring back his dead love, but there's little information about them. It just lumbers slowly into view when you confront it, and what follows next is one of the most tense battles I've played in a videogame. You're clearly outmatched, a young man who barely knows how to swing a sword against this massive moving monolith, but you somehow manage to succeed. Just as you're ready to cheer out in victory as it falls, the game takes a shift. Instead of the triumphant battle theme, the music turns soft and sad, and you watch your foe slowly tumble down. Instead of glory, you feel regret, and your victory now seems like a tragedy.
Seeing that in film would be emotional, but it's not some character doing it on a screen. You did this, and you killed this strange and magnificent creature. Was it worth it? There's a similar example in the ending of Metal Gear Solid 3, but I'd rather not spoil the amazing ending of that game (which would generally works as well in film, except that one particular moment).
No, you have years of experience in a medium that prepared you to interpret that event a certain way.
"it was because you were prepped by playing the game to experience that scene in a particular way."
That's like saying, "Yeah, I jumped into the Iliad at the funeral games for Patroclus, and I just don't get it: it didn't have an impact at all." Duh. The literary experience leading up to that event leads to a connection to the characters that has little weight if you skip it. Saying the same thing applies to video games isn't an argument as to why video games can't be expressive. It means they can, and you have to invest in them to have that experience, much like reading a book.
And the best games aren't "built around" movie-like cutscenes. But suppose they were, and that those scenes were evocative. How, exactly, is that a bad thing? It's not, unless you've a priori decided it is.
Actually, my point was just the opposite. You can appreciate a passage from the Iliad or a scene from a movie without context. Not fully, but there's something there.
First off, what is a game? Let's consider two broad types of games: competitive games and puzzle games. Competitive games (like chess) feature more than one player and the outcome of the game is unknown (both in terms of the winner and the final game state). Puzzle games (generally speaking) don't have a strong competitive element and the final outcome is known (i.e., a lone player solves the puzzle).
I contend that first-person shooters (in single player mode) are nothing more than big puzzle games. This isn't bad per se, but the problem lies in how these games have evolved.
Rather than make the "puzzles" in FPS games more challenging and innovative (i.e., focus on gameplay), the major game studios have instead focused on increasing the audio-visuals and cinematic attributes of their products. As a result, gameplay has consistently been minimized in favor of eye candy.
No better example comes to mind than the recent smash hit, L.A. Noire. The extent to which the producers of this game clearly wish they were making movies comes off as obsequious. The tiny sliver of game mechanics they did include is mind-numbingly repetitive and utterly without challenge.
These things are no longer "games", they're shitty movies.