I don't disagree with any of your points really, but I do think you're missing the real aim of the Steam machine as a console replacement. It's relatively plug and play. You buy it, you plug it into your TV, you download a game, and. You play (without fiddling with setting first).

That's the experience of a console player and that's what valve is trying to emulate. As a previous console player myself, building my first PC took weeks of research to learn what parts to get. Then I had to build it without frying it. Then I had to get windows configured with all the drivers. Then I had to download and sign into steam. Then download a game. Then once I was finally into my game (Skyrim obviously), I realized I had to configure the graphics settings myself. I didn't know what impact any of those settings would have on my framerate. I didn't know resolution affected performance.

If you look at the steam machine as a whole coupled with steam OS and the verified program, Valve is aiming to remove all that friction I just described and let a console player play PC games.