We've had a used console game market since the Atari 2600, and yet here we are, console games are still being made. Even with the increase in production cost, more console games than ever are being made. This isn't an issue with the used game market, this is an issue with publishers and developers. There is nothing that needs to be changed or eliminated when it comes to used games, if anything, most of the people I know that trade in used games do in as a way to afford/justify new game sales.
We're also talking about this on the edge of the first year ever that videogames made more money than movies. Yeah, obviously, Activision and EA are living week-to-week when it comes to finances.
If Microsoft and Sony implement non-used game technology into their next generation of consoles, I'll just be really happy that I have a huge backlog of PS3/360 games to go through, since that's not a console I plan to buy anytime soon.
I think it's pretty hilarious that any gamer would defend the position to get rid of the used game market completely. They did it on the PC, and game prices have still gone up on that platform in a lot of cases, and they definitely haven't gone down. Believing that game prices will drop if there are no used game sales is ignorance at the highest level, especially given the track record of the publishers we're talking about in most cases.