No it's not. What you are talking about is stuff that is only the case if one doesn't bother to explore what the PC has to offer and locks themselves to their own perceptions. The small factor PC cases have been around for several years. Yes, they have reduced in price and size but originally, they were no bigger than a PS3 or Xbox. An upper Medium End gaming PC would also not cost you more than what one of the Next Gen consoles do at launch with only minor upgrades required every 4-6 years. You only need a whole new set up when technology has vastly revolutionized that's only like every 8-10 years when you have to upgrade the MB and CPU. It can actually cost much cheaper if you build it yourself! Of course, if you go for some BS like Alienware, it will cost you more but that's an individual's choice, not representative of real world. It would be like saying 'Cars are too expensive, just look at the cost of that Lamborghini'
Who says you need a keyboard and mouse to play PC games? The PC is so flexible that you can play games with anything including PS3 controllers and even Wiimotes! And that's not counting the thousands of USB controllers already available, wireless or otherwise. Yes, most PC gamers prefer the keyboard and mouse set up but it's not as if that is the only option to play PC games. I personally prefer the KB&mouse set up as it is infinitely more precise than a controller, specially for 'free aim' shooters. That is why I am looking forward to the Steam game controller which appears to be aiming to revolutionise the current and somewhat outdated controller technology to bring the precision of the keyboard and mouse into the lounge room.
If you know what you are doing, in the long run, a PC costs less and requires a lot less stuffing around than a console does. My PC runs awesomely with little maintenance, less so than the PS3. It is also vastly superior technically and at least on par with the Next Gen and I only have medium end hardware in it.
I am not a console hater as I do own a PS3, but I find the PC to be a much more superior and flexible gaming platform than any console. Cheaper in the long run too with less issues. When there are multiplatform games, the PC wins every time when it comes to crisp and smooth graphics so the PS3 is only there for the exclusives. Even so called 'poor ports' like WFC look a lot better on the PC than on the PS3 on a 1080p TV and I own both releases to compare first hand without a bias of 'you only say that because that's what you own'. On a 2560×1600 screen, the PC blows it out of the water and that goes for any multi platform game.
For me, the PC is the gaming system that rules them all. If it wasn't for exclusives, the console would not even be there as my TV PC has a bluray drive.