I expect Microsoft to register the game to an account so no matter who's console it is, as long as you are logged into your account the game is open to play. The patent I read from Sony seem to lock it to the console itself which is a horrible idea if that is the case. Which ever console pulls it off with the most accessibility, and with the least amount of headache, will have a high chance of becoming the leader in the next console generation.
The developers will love to see the second hand market go away. You can make a compelling argument that piracy isn't a money loss because the pirate wasn't going to purchase the game anyway. It's completely different when it comes to used games. The consumer went to a shop with the intent of purchasing a game and if that purchase was a used copy then the developer received none of the profits. The exchange of money happened with the profits going fully to the retailer. Developers make their money on the first few months of release after which the profit of their product bottoms out because then the second hand market takes it all. With the second hand market gone a product can make money for years, maybe even decades.
If Microsoft went to developers and promised they will make a profit on their products for years because of the elimination of the second hard market then you can bet they will eat that shit up. It wouldn't surprise me if the developers actually try to push this to be the standard by making big title games exclusive to Xbox only. In doing this it will force Sony to do the same or be left with stripped down version of games to entice people into buying the Xbox version. Games that mostly rely on online play will be immune to this like CoD. Sony will have no choice but to release the PS4 with the same conditions as the Xbox if Microsoft came out and said games will be locked to an account. This also ensures that you keep your customers locked to your console.
With that said... Sony and Microsoft will have to play their cards right for it to work. If done wrong then they just rolled out the red carpet for Valve/Apple to take over the game market. There is no way they are going to convince people to be locked into their closed ecosystem with games being at the same price as they are now. People are already accustom to purchasing a 60 dollar game, playing it a few weeks, trade it back in to recoup some of their money, wait a year later and repurchase it at 5 dollars used. They will have to adopted a steam like system with doing massive 75% off sales or people will just go to steam/piracy. I actually foresee Sony being able to do this and not Microsoft.
Where does this leave Nintendo? Dead last with Mario and Zelda. Along with a dwindling handheld market slowing going to phones/tablets. They will either conform to the new standard or go third party in the coming years. If they thought convincing third party developers to spend money porting games to their under powered system was hard, wait until they have to explain why their second hard market will not be a loss in profit.
Sean and I had this discussion on the FoH board and I still go with the fact I'm probably talking out of my ass. Neither Sony or Microsoft has announce what they plan on doing.