Fucking shame it is then that the customers do not extend the same courtesy.
Are you familiar with the phrase "pearls before swine"?
As for this particular instance, the DRM scheme proposed was clearly anti-consumer in nature. The disrespect the gaming community showed Microsoft as a result of it was entirely justified.
It will be some time before Microsoft regains the respect of the majority of gamers, if at all.
First, consider how many gamers can articulate the difference between developers and publishers, and who they get angry at when games don't go according to plan.
In my own home town, Timegate Studios just shuddered from the debacle of Aliens: Colonial Marines--and was widely blamed by ignorant gamers despite a history of solid games and expansions.
Gamers bitched to no end about Steam when it was required for CS 1.6, even though it was the future. Look at all the complaints about CS:GO from the hardcore players (one memorable thread involved a HUD tweak driving some clan rabid because it screwed up their grenade-throwing technique). Others complain about Valve doing nothing since Episode 2, ignoring Left 4 Dead and Team Fortress 2 and DOTA and whatnot.
Look at the way gamers and reviewers panned Duke Nukem Forever, ignoring the fact that dozens of people poured over a decade of their lives into that thing.
Look at the flooding of gamers over to free-to-play and ad-driven titles, pushing the race-to-the-bottom of devs only to then give angry reviews on the app store.
Look at how every online game reviewer and game poster crows and white knights about the portrayl of women and gender roles in games, and yet look at how they actually spend their dollar vote.
Look at how the gamers mocked Doom3 for having a pretty solid and amazing lighting engine and pushing shadow tech to the limits of its time.
Look how gamers today complain about older titles that don't hold their hands with navigation and lots of simple mission objectives--and then bitch about how games today are too linear.
Gamers are the worst sort of customer after dollar web-hosting ones.
The second violators of this are what I'd call the `On-the-Go` gamers - People who play games that don't take a ton of involvement or time to get going into them. Their library typically includes games like Angry Birds, Bejeweled, Sim City, and Nintendoland.
Coincidentally, it seems to be that the biggest names out there seem to focus their marketing on these two archetypes the most. I partially think it is because they're the least interested in all the crap and drama that goes on in the games industry, and secondly, they're the most impressionable when it comes to marketing. Make things big, gritty, and loud to attract `en masse` gamers - Make things colorful, shiny, and quick for `On-the-Go` gamers. Easy money.
It is quite a bit more difficult to reach the `core` gamers (of which there are many sub-types). These people care less about games being easy to consume, and more about the quality and depth of a title. These gamers have no problem with voting with their dollar and will often prefer games they know and love if the newest game doesn't look up to par. Unfortunately these types have been slowly getting outnumbered as easy to consume games bring in new customers that don't really care about the differences between developers or publishers.
Regular gamers can be great customers, but slowly it seems like games are being marketed toward gamers who don't care about the games they're consuming and who won't complain when 50kg of DRM and ads are tacked onto their game.
It's been well-proven by Steam et al. that if you price correctly and use an unobtrusive (or even nonexistent in the case of GOG) DRM scheme, people would much rather buy and support their favorite games developers (and publishers) than go through the effort of pirating a title.
That's why games sharing would work with only minimal abuse. Not because it wouldn't be technically feasible for the consumer to abuse the system, but because the barrier to actually owning the games they want to play would be so low that it would become the new path of least resistance.
The sky's the limit if the industry can learn to treat their customers with respect.
Edit: By the way, a version of games sharing already exists on the PS3. If you purchase a game digitally on PSN you can install and play it simultaneously on multiple PS3s as long as your account is on each of them, I believe up to a limit of 5 PS3s.