The inclusion of BR player is unnecessary for this gaming generation. If anything, it is a commodity for videophiles that need their fix of HD movies. However, I agree with you in that there are developers who will take advantage of the additional space, but they will be the exception, not the majority. This additional space, however, will not revolutionize or immensely affect the length or content in games. For one, developing games is already expensive enough. And two, the trend of supplying additional downloadable content will continue. I really do not see a reason for BR, when HDD have been implemented in the consoles already... it's either one or the other.
As for big games on DvDs, just look at Mass Effect and Oblivion; both have stunning graphics, immense environments, and seemingly unlimited content, all one DvD. I don' think anyone can condemn dvd as a format after looking at Mass Effect in action. Yes, some developers have shown that they are capable of compressing and using "tricks" better than others, but I think that part of the problem is with PS3 dev-kit (i.e. Oblivion) not the developers.
Also, look at what Nintendo was capable of on the GC with 1.5GBs. A perfect albeit overused example is RE4. This game was the pinnacle of graphics on the GC, and arguably one of the best looking games of last-gen, all packed into a mini-disk. When this game was ported to the PS2, it saw a downgrade in graphics and effects and a minor upgrade in content. Was the use of a DvD (4.8ishGB) necessary? No, but I bet Capcom went the easy route and filled most of it with uncompressed data.
I think that the PS3 will definitely impress everyone in the future, but it won't be because of BR, but because of the games and Cell. As I've said before, I love the playstation brand and would choose my PS2 over my Wii any day (ready the pitchforks), but Sony lost me as a customer with the addition of $200+ that resulted from inclusion of BR... all to win a format war.