Not much to add to a thoughtful and insightful post.

The point about service-based games being perfectly suited to supply more content and profit by that, and the recognition that this content is often focused around narrative, is a really good one. I think about adventure games like Blade Runner which had a very rich narrative graph, when it was way too expensive to do such a thing and expect to be profitable enough to make another game. "Service-based" games *do* make that possible, and the space of "narrative elements that might plausibly fit the world and complement or support expansion of the game mechanics in place" is largely determined by good world-building done up front. I would expand on that but I'm already making a hash of it.

(PS: You do have an "ever, ever" where I think you meant "never, ever".)