We never had game shops around me that look like the ones we saw online in other countries, those looked like relatively cool places to have around. I also once told a friend coming from the US to buy me a whole bunch of used games from a Gamestop and I was amazed how cheap they were. We only had overpriced originals or super cheap pirated games here, used cheap originals were neat.

I wouldn’t hang out in such a place as an adult (and I’m icked by retail-as-community-space) but maybe as a teenager it would have seemed nice. Just being able to ask the people working there for opinions or recommendations was probably a big part of how games work for people I’d imagine.

People already were, only 15% of PlayStation users are buying physical media.

Never gonna happen, lol (I'm ironic, that's a tragedy).

Are people seriously going to buy a console that doesn't even read a disk, just to download a game from the internet?

Are you seriously asking? Because I've seen time and time again, the answer to those kinds of questions seems to be yes. I think most people just don't care, and they don't need to, they'll only buy a few games in a console's lifespan to play for multiple years, and they'll either just pick up what's popular, or whichever one has a game they want to play.