The thing is that would absolutely cripple the PC and slow down progress in technology. The hyper-competitive market in the PC space is what brought us all this crazy fast 3D tech in the first place. You would basically end up with an expensive console with all the drawbacks that turn the average joe away from gaming on a computer still there. Not to mention that if all the various players came together and decided the direction that the industry should take, it would put the customer in an extremely weak position. We already pay so much for the hardware now, what would happen if there was essentially no choice?
It's an unfortunate truth but ruthless competition is the most effective way to get humans to innovate. You only have to look at what came out of WW2 or the Cold War.
It sucks that the PC plays second fiddle to the consoles, but you have to look on the bright side that at least we do still get ports (we could be down to just a handful of games every year). Any vendor specific fluff that gets added for PC is just that.
With everything in such a state of flux at the moment, both in terms of API's fighting for dominance and GPU's & CPU's slowly converging, it's just impossible for developers to develop a game for the consoles and PC and truly take advantage of both systems. The hardware gap is just too wide and the costs associated with writing tons of bleeding edge PC specific code doesn't pay off. That's why console dominate right now because you remove a massive amount of headaches from the equation.
Hopefully when future hardware evolves out of Fusion/Larrabee/Fermi and what we are left with is many heterogeneous cores on one chip, a lot of the questions about API's or software/hardware will become moot anyway. I don't expect that to happen for another 2 console generations or so though at a guess, and it has to happen through survival of the fittest.