More power means more complexity means longer development cycles and higher costs.
That's not really true at all. Yes, PC games usually go through compatibility testing but that's outsourced, takes about a week and is performed only a few times throughout the development cycle. However, PC games do not have to be submitted for certification like console games do and certification is a significantly more costly matter than compatibility testing. There are dedicated, full-time QA testers who specialize exclusively in cert testing and comprehensive cert passes are performed regularly. The actual submission for certification is very expensive and has to be planned far ahead. If you miss your scheduled submission date or fail submission, that's more money down the drain. Then you have the cost of dev and test kits. A single dev kit costs around $10,000. Most games have at least 10-20 programmers so that's $100k right there.
Then there's ease of development as well. A common misconception amongst people outside the industry is that developing for a closed platform is faster and easier. That would be true, if the closed platform weren't horribly outdated. Compiling, linking, loading and running a PC build is significantly faster process than on X360 or PS3. A modern PC can run a debug build with a higher framerate than consoles can run submission builds, making it much easier and faster to test your changes. Oh, and don't forget memory. PCs have lots of memory. It's rarely an issue for PC developers. Conversely, memory is a huge
issue for console developers. Trying to work with 512MB of memory total is brutal. Do you know why RAGE's engine was designed around texture streaming? Because that's the only way to fit those textures into console memory. Console developers spend more time working around memory limitations than PC developers spend fixing compatibility issues.
That PC development still gets AAA SKU's at all is almost amazing right now.
It's not amazing at all. Developing a PC port is cheap. It's only a small fraction of the total development budget and as such, it's easy to generate a profit from. That's why more and more publishers are releasing PC versions of their multiplatform releases. In addition, digital distribution gives publishers a much larger cut of each sale than retail, making it even easier to profit from PC sales. You'd be stupid not
to release a PC version of your game, unless it was in a genre that has no audience on PC.