As unpopular a view as it may be, digital distribution has been the inherent cause of the devaluation of games:
1) First problem is the obvious issue of supply and demand. It plays a somewhat secondary role in this case, but because there is no issue of scarcity, and because supply is infinite, the actual value of a game is zero, which represents the lowest that a price can go.
2) The biggest problem is competition. Because digital distribution lowers market entry barriers, there is so much competition that the race to the bottom as far as pricing is concerned was inevitable. Because prices can't really go any lower without cutting into the core development and marketing costs, developers have had to start using alternative business models and try and market games as being that cheap whereas additional investment is actually required to play them properly.
3) People don't see value in digitally-distributed games. Indeed, the reason behind many people's decision to go partly or fully digital is because they can get games for near-zero value. This might have lured many former pirates away from that scene, but it also lured many former full-price payers in, who now pay a fraction of what they were paying before.
Back in the 1990s, there was an industry push to promote the superior value of genuine products over piracy - namely boxart, manual and the like. OK, nowadays you don't have the manual, and many games don't even have a decent box, but the superior value is still there in the form of resellability and collectability (also collector's editions with manuals, figures, maps etc.). Not to mention that in many cases (especially on Steam, as well as digitally-distributed games on PSN and Xbox Live), the pirated product is actually superior. GOG is essentially the only digital distributor to date that has done anything towards keeping the digital product on an equal footing with at least pirated versions quality-wise.
The new technologies and distribution models have a reason for their continued existence - it's just that this reason may not be what developers were hoping. With the physical/digital share balancing out now, there's unlikely to be an all-digital future - instead, digital distribution is likely to remain the realm of lo-fi indies and casual titles, as well as extending the long tail of back catalogue titles and as an alternative distribution channel for major titles. I don't see digital for major titles stretching much beyond the present 10-15% mark, and neither do publishers, if their apparently diminished interest in the digital future is anything to go by.
Even now, many developers and publishers have started targeting physical releases, partly to stem devaluation of the product (addressing point 3 above), partly to enter a less competitive marketspace (addressing point 2 above).
Along these lines, the future of mobile is likely to lie in short, cheap, casual titles that are suitable for 5-10 minute breaks, which the format is best suited to. As others have said, mobile is not really suited to long-lasting, in-depth experiences, in part due to the nature of distribution, in part due to the nature of the format.