How many open system gaming consoles have there been? Why haven't they trounced the Xbox, PSP, DS, etc. etc. etc.?
Maybe if a large company were to release an "open system" there would be a prayer. But Joe Blow in his garage probably isn't going to bother.
All things being equal in this situation would mean: one xbox that has closed development and one xbox that has an open development system. I think the "open" platform would eventually pull ahead.
Like someone else mentioned, open system does not equal open source.