The physical games also require approval from the console maker and they still get a cut. This is has been true since at least the mid 80s.
Look at every retro console - their games still work on their platforms, and there's a second hand market for games. It's a shame they're no longer made, but at least there's a physical copy that can be traded instead of a digital copy DRM'd to an account on a store that's no longer operational.