So if piracy is becomming a problem on consoles, and it was ok to implement measures to combat piracy on PC's, what's the difference between doing it on a PC and a console?
If piracy was as big a problem on consoles as it was on PC then I could see a moral argument being made in favour of this form of DRM, but even then I don't think it would be reasonable. Piracy on consoles involves messing with the firmware, and if you bring your modded console online you risk your account being banned. It's not a perfect system, but it would be far more reasonable for MS to devote their resources to tracking modded consoles and hitting pirates directly than pursuing their current plans, which involve blanket restrictions on legitimate customers. Since piracy on PC is much more widespread, much easier to perform, and much harder to fight directly, I can understand why broader restrictions are enforced. (But even on PC, I refuse to accept DRM that goes too far, such as SimCity's always-online requirement.)
But I think most of us know that MS isn't pursuing this policy to go after pirates, but because of the used games market. Publishers have been bitching about used game sales on consoles for the last few years, with some even going to ridiculous lengths and claiming that it's destroying the industry. I can see no moral argument to support DRM aimed at used games because there is nothing illegal or immoral about them. I can understand why publishers are annoyed by companies like Gamestop that make money from the practice, but that's no excuse to screw over their customers.