I really don't think he's suggesting taking content out of future new titles to be sold/packaged differently.
I think he's just suggesting if you took the cutscenes out of one of the quality games, like the intro videos for WoW for example, that the level of quality, and design, creativity, basically coolness of them would make for a great film.
Its like someone called Cameron 5 years ago saying to an investor panel
"If I took Fern Gulley, changed it around abit and packaged it up differently, IN 3D, wooo, then I could make a killing and fool people into watching the same film for the 9th time, don't worry we'll fire a couple arrows at the camera so 3D really pops"
AS much of a rip off as Avatar is, it isn't actually Fern Gulley, they didn't remaster it with 3D, its just a way to sell the idea, give the guys you're talking to a general idea of what you're talking about.
He's talking about a general idea, he can't say "I think we can take FILM 1 we released in normal cinema's last year, repackage it and deliver it directly to consumers at home when we release Film 2", simply because they haven't made a film 1. The closest thing he can compare it to is the cutscenes.
Thats how I understood it anyway, largely because, I'd personally pay a bit more for a game that had a WOW type intro(because they are cool, Lotro's intro is pretty badass, and cutscenes in things like C&C were fantastic) and added 50 times more content I'd pay more for a game that offered more, I've paid to see animated films, I'd potentially pay to see a film the guys behind some of the awesome stories and cutscenes in games make, if its good.