(I'm all-digital and have been for the last nine years, but there are compelling reasons not to go that route)
1. Just like movies, you don't own anything. Revocation can occur at any time.
2. More likely than movies, you might find your game patched to add or remove content you do not want.
3. You can't give your games to the next generation. Which matters a lot when your exposure to gaming started from NES and Atari hand-me-downs.
4. Every game you purchase is chained to just yourself. Which is actually stupidly selfish when you have a large extended family also interested in games. The Switch is a hit for borrowing back and forth from a large network of relatives and friends (and, if Nintendo's reading this and questioning the resale market - this has caused a lot of games to get bought that wouldn't have).
5. If you have a large NES collection, there will be someone interested in paying for it. If you have a large Switch collection, there will be someone interested in paying for it. Physical games have some asset value, and it can be thousands of dollars for larger collections. Digital games have zero value.
Can you play a ps5 game from optical media without having ever connected your ps5 to the internet or will some refuse to run?
On the PS5 refresh, no, an internet connection is required to activate the drive, whether or not it came in the box.
On the Xbox One... you haven't been able to, for over a decade.
On Switch... Switch is just delightful. The game cards even come with the required system updates (criticism for lack of theming or music aside, the whole OS is under 400MB, so amazing things are possible). You can also update your game or system wirelessly, from any other Switch, which has a higher version of either, no internet necessary.
Because the disc drive and the main board are required to be paired with each other since the PS3/X360 era. People who repair PS3s (except super slims, for some reason) and PS4s need to re-pair the disc drive board with the main board (or failing both, replace both boards with one that has been already paired) every time there is drive replacement: https://www.psdevwiki.com/ps3/Remarry_Bluray_Drive (for PS3)
In the past, they were at least paired from the factory. If you pulled your Xbox 360 out of the box, and never connected it to the internet, it would still work.
The PS5 refresh's disc drive is not paired, even from the factory. Without an initial internet connection, it will not work, even out of the box. Also, unlike the Xbox 360, it un-pairs every time you sign out of your personal account.
Well, yes for the NES. There's a limited number of cartridges made, there is no digital substitute, and the official cartridges are not being manufactured anymore. The demand for NES games is a product of their scarcity.
But have you tried actually selling a physical copy of a modern game? It's not like you're making your money back, you're lucky to recoup 1/3rd of the MSRP if there's even anyone interested in waiting for your copy to arrive in the mail. But there's also complicating factors like piracy, the immediacy of digital storefronts, and the used market controlling (and lowering) the price of used games. Famously, a trip to GameStop with a stack of PS3 games is worth maybe $5 of in-store credit and a complimentary soda pop.
Flash carts exist that can bridge your own digital ROMs to original NES systems.
Given most games won’t work without online activation, does it even matter in the case of PS? Or you’ll contain yourself to non Sony/Microsoft platforms?
Well this is a complicated point. A lot of games these days rely on digital distribution for day-one patches, a practice which allows developers to continue working on and polishing the game even after it goes gold. Physical only really gives you the option of "no updates at all" (including no day-one patch) or "every update so far to date" (including updates you don't want).
I agree with the rest of your points, but I think that this one would be relevant only in a few extremely niche cases.
For Switch games, you can always refuse to upgrade the game (the cartridges are read-only, the updates are stored as overlays on the microSD card or internal storage). Switch game cartridges are just fancy flash cards with a long-since reverse engineered communications protocol [1], and there's multiple card dumpers and reflashable cards on the market.
Correct me if I'm wrong, but you'll still rely on Sony's servers to get the updates that make the game playable, since it has become customary to ship games riddled with bugs to patch them afterwards (which doesn't happen with movies, yet).
And if they really want to target you specifically, they can still blacklist your console by id, unless you completely stop connecting your console to the Internet.
So, buying the physical version can only protect you against revocation in very specific cases, unless you want to limit yourself to playing the broken version that is shipped on the disc.
I compared the prices of disc releases and digital releases on the PS5 in early 2023 and you could often get the physical disc release for cheaper than the digital:
Final Fantasy XVI (PS5): 65€ disc / 80€ digital. Hogwarts Legacy (PS5): 59€ disc / 75€ digital. Diablo IV (PS5): 70€ disc / 80€ digital. Resident Evil 4 (PS5): 60€ disc / 70€ digital.
I think a lot of people would stop buying consoles if they couldn't sell the games they have finished or do not like anymore to fund the purchase of other games.
I don’t think the younger generations care as much, they just play free games anyway.
I bought Zelda Breath of the Wild for 25€ while it is still sold around 60-65€ on my country's amazon market and is not available anymore in many places.
I mostly buy cartridge because I want to be able to play games regardless what happens of my nintendo account and I like being able to lend and borrow games with other switch owners.
I remember as a kid we would swap games with friends for a few months so we can have access to other games.
That's lived in my head since.
(The single greatest moment isn't one moment, but turning an obscure technical description into "blast processing". <https://www.youtube.com/watch?v=bun8tA_ksZw>)
I played Excitebike [0] on a friend's childhood NES and CRT TV while visiting over Thanksgiving. All we had to do was blow the dust off the cartridge, and we were living in 1984 again. Having physical copies makes this scenario far more likely to succeed.
Physical media gives the impression at least to console gamers that they "own" the game for the long term and the loss of a digital storefront won't impact them (even if it's not always true).
Whereas with a disk you can pay substantially less due to your choice of competitive retailers (in my region Space Marine 2 is $79 at some retailers or $109 from Sony), buy secondhand for older titles (most of my library is secondhand), and resell or trade-in games when you're finished with them. And of course it's not tied to an ephemeral account, so you will always have access to the titles you've purchased.
Also for my use case, my PS5 doubles as a Blu-Ray player which is worth a good $100-200 just by itself.
But yes, other obvious benefits include sharability, resellability (especially these days. So many childhood favorites sell for 200+ dollars for some reason), a perhaps false sense of preservation (I know there are some icky server issues on gen 7+ consoles, even for single player games), and simply liking the feel of a case and disc.
Steam will go the way of dodo when the founder and his culture is no longer around.
Who knows, the new management might even sell it to Microsoft and retire for life.