I agree 100%. However I don't think that Microsoft's original vision need be left behind in their new DRM structure. Here's how I imagine it could be accomplished so everyone wins.
Perhaps, instead of requiring a disc be in the console despite having all its contents loaded on an HDD, you could activate a game's ownership rights on your account temporarily.
Each game would have a unique "CD-key" attached to it much like on the PC which you can choose to input (hopefully via a QR code). If you input the code it will lock down that disc to your account specifically so you no longer need to place it in your console (the same as if you downloaded it).
Then if you want to resell/trade/trade-in this game you select the option from the start menu to generate a new code. This game would now unplayable on your system without the disc (as it would be currently) and you are sent an email with a new slip you can print out and place back in the game box. The point of resale could then scan the code to make sure it is unused before accepting the sale.