I think there are a lot of factors involved in the problem:
#1: None of the authorities pay much attention to the game industry. One thing that a lot of people seem to miss is that while the USA is a capitolist society, it does not operate on a principle of unfettered capitolism. That is to say that the spirit in which it operates is one where it's fine to own property and pursue a property, but things like monopolies, guilds, and cartels are not okay. Capitolism is fine as long as there is direct competition. In cases where a business by it's very nature requires a monopoly (due to a massive infrastructure or whatever) then it faces increasing levels of goverment regulation.
If you pay attention to how the game industry operates, it functions pretty much as a Cartel even if the members choose not to see it that way. Rather than competing directly, products are shuffled around so as not to interfere with the potential audience of another big product. What's more the industry sets prices, irregardless of development costs involved in a game, they all cost the same thing new for the same platform. The price of admission for a console game is almost universally $60 whether it cost a million dollars to make or two hundred million.
What's more the industry has directly coordinated price hikes, and has talked about doing it in no uncertain terms, along with the spectre of them doing it again occasionally rising. Such as when the price of games universally rose from $50 to $60 for the standard cost of admission. The industry went on to defend this desician, and few people bothered to even make note of the fact that this isn't supposed to happen, at least not in the US market.
The observant might notice that with gas companies, they are under constant federal investigation for coordinating price increases, and operating as a cartel in the US which is prohibited by law, though difficult to prove.
The bottom line is that with no consumer advocacy for gamers, and the fact that groups like the BBB (Better Business Bureau) not getting involved, there is no real reason for the federal goverment to take notice. As a result you see things like the "Game Developers Conferance" and other meetings of industry big wigs doing things that other industies like the gas companies only wish they could be so obnoxiously open about.
The basic point here is that companies are supposed to compete directly to produce the highest quality product, for the lowest price. When you see things like happened with "Modern Warfare 2" where other big releases were pushed up to avoid competition, that's a sign of the poison. What should have happened was that everyone involved lowered their prices as far as they could while still making a profit to try and undercut the other guy.
What's more this kind of attitude stifles creativity, with no direct competition there is no motivation to create things to utterly "wow" gamers. The lack of competition slows innovation to remain within specific, proven channels of production. There is no real need to take risks when a company can just churn out another generic game from the "Unreal" toolbox and expect a return. Everybody does it, and since nobody REALLY competes, there is no real reason not to do things this way.
2. Another big problem is us gamers ourselves. A lot of people don't like the analogy but we act like a group of junkies. That is not to say that this is what we are, but there are a lot of similarities. Simply put a lot of gamers want to game so badly in their chosen genere, that they will buy the latest products without bothering to consider what that might mean for the industry. This is how guys like Bobby Kotick can be such jerks, it doesn't matter how he treats developers, what he says about gamers, or how much he gouges gamers for ridiculous "Horse Armor"-like DLC. Activision and it's sub-companies wave the newest and shiniest FPS in front of the market and people surge towards it lemming-like even if it's not in their best interests due to encouraging abuse.
There are a lot of similarities between how Drug Dealers treat junkies, or pimps treat their whores, and how industry big wigs like Bobby Kotick treat us. Like the people on the receiving end of that relationship we keep coming back for more as well.
Peer pressure is also a factor. I mean one of the reasons why "Black Ops." is likely to sell well is because it's unthinkable for FPS fanboys not to play it because they feel all their friends are going to be playing it, and if they aren't there they will get ejected from their peer group. Given that for many nerds this might be their primary means of socialization it can be unthinkable. This is sort of like how peer pressure at parties and such can contribute to junkies not being able to overcome their addiction to something that is hurting them/leading to their explotation.
Just watch, "Black Ops." is likely to sell well, and as a result it's unlikely anything will change. We know "Starcraft 2" did, and really I doubt anyone expects the Blizzard fan-base to turn their backs on "Cataclysm" in any noticable numbers. Guaranteed almost everyone in the gaming community bought, or will buy one of those products.
What is being said about Activision here can apply to pretty much any game company abusing gamers, companies like EA got away with similar things for a long time.
On a final note I will say that the complaints about the working conditions for game developers actually seem funny to me in most cases. Especially given the amount of money going towards human resources, and the fact that they are in what amounts to a risk free profession.
Comments about the working conditions and having "maniacal bosses" and the like strike me pretty much as "having a job" which might be shocking to some people who came up at a time when the gaming industry was smaller and less corperate, more of a creative/artistic industry than one oriented on making a profit.
I mean think about it, this kind of working enviroment is so typical that they even make sitcoms about it. The whole "cubical"/"desk" subculture is massive and inspires jokes about exactly the kinds of things they are complaining about.
What's more, I rarely talk about what happened that caused me to actually be fired. Legally I was "fired without cause" despite opposition (and thus collected unemployment for a while before I retired on disabillity). Without going into the details the bottom line was that one of my supervisors threatened to "rip my head off" (literally) and while I generally know to keep my mouth shut even when threatened, I decided to say something back about him sticking his tongue up a tribal member's ass for political reasons... which was true, but let's just say I have a lot of emotional problems and it was not my first outburst (and they were looking for reasons to get rid of me due to agitated behavior like pacing, talking to myself, and other oddities which were getting increasingly worse despite doctors and medications, I lasted a long time because I was pretty good at what I did though).
The point here is that getting chewed out, threatened, dealing with politics, and everything else is a part of any workplace. I was "fired without cause" because what happened was beyond the pale when you get down to it (the incident leading up to that was ridiculous), but in the end I like most workers know enough to keep my mouth shut usually and it takes odd conditions not to do that.
Saying that these guys have maniacal bosses is pretty ridiculous because ALL bosses are maniacal, and the reason why work is work is because it's unpleasant and stressful. If it wasn't, then they wouldn't need to pay people to do it. I think a lot of the problem with the industry is that they love the perks (and yes I believe they get major perks) but aren't used to actually working for a living.
I'll also say that I know this from both perspectives having been both on the floor as security, and having worked in things like the monitor room and acted as a dispatcher. Not to mention the involvement of security in walking people out who are fired in other departments and the like. Meaning I've *been* that jerk at times, as opposed to just being on the receiving end of it, and know exactly why as a "boss" you can't be too nice. If you need something done, you want it done right then and there, done right, and efficiently. If I dispatch someone for a job I know takes 15 minutes, and I try and dispatch the same person 45 minutes later (checking the log I keep) and they still aren't done, what do you think happens if they don't have a bloody good reason (and if they did, they should have called Dispatch)?
Not sure how many people will read this, but the bottom line is that I think the seamy side of the industry is the industry vs. it's customers, not anything internally because at it's worst (even with the insider whistle blowers) a lot of it sounds like the same kind of crud you can find anywhere else where a lot of people work.
You just have to deal with it. Maybe your ungrateful supervisor does something like sends you to perform an alchohol shutoff (ie patron has had too much to drink and is harassing the servers about it so as security your responding at their request to enforce things), which often results in a report, and having to cover your butt in extra special ways because of the inevitable complaints about how rude and nasty you were in making sure they understood "no more drinks". God forbid you needed to be a little "threatening" while also being polite by calling in more security to chill him out simply by being there. Routine, but your also scheduled to perform a daily escort, shortly thereafter and get delayed because your writing a report from the shut-off he sent you to do, so you get yelled at.
That is NOT the incident that got me fired, but rather an example of a routine annoying job occurance. It's a differant job so the details are differant, but akin to the kinds of things a lot of game developers whine and "whistleblow" about it seems (some of the complaints are really petty). That's part of being employed.
I also laugh when people complain about long hours and mandatory overtime, it's wonderful to be stuck on a post and not able to leave on time because due to call outs they don't have anyone to relieve you immediatly with the incoming shift, or you get stuck doing something like watching an unsecured door in an out of the way place and get forgotten about. I've been there, and so have most people who work, even if the reasons for it are differant based on the job.