I have an 'ok' pc that can handle most games at full settings but I still find that the consoles surprise me in terms of graphics, especially when you consider how old the hardware is now, both 360 and PS3 have games that I think you'd be silly to say that they look 'pap' just because they aren't being rendered at 1080p.
I love how maxed out PC games look but I honestly find myself having more fun on the console because I know I'm forced into accepting the graphics as they are and thus end up enjoying the game more without thinking about frame rates/settings etc.
Simple fact is more people care less about graphics than people do that do tbh, I respect graphics but gameplay for me is much more important which means owning and playing console is very important as the 360/PS3/Wii have hundreds/thousands of exclusive games that will never be available on the PC.
Also price is a key factor, most people these days already own a TV from quite a young age so all they or the parent has to purchase is a console, you can grab a 360 slim Arcade today for £139, that's it, that's all you need to get into gaming.