Oh, and Zeus, I checked it out. Xenosaga Episode III launched for $39.99 US, I have no idea where you got that $50 dollar figure from. I think you should repair your argument.
http://ps2.ign.com/articles/729/729140p1.html
August 29, 2006 - Namco Bandai announced earlier today that Xenosaga Episode III: Also Sprach Zarathustra, the final chapter in the expansive RPG series, has shipped for the PlayStation 2. The game is expected to hit retailers across North America today.
Xenosaga Episode III: Also Sprach Zarathrustra for the PS2 will retail for a suggested price of $39.99
Anyways, the Mii channel does certainly have gaming applications, the core of it is gaming applications:
In its most basic form, the characters are created for usage within various games. Wii Sports is a perfect example, you can create a character to use within that game. Though that is not quite where it ends. From there, the character can be taken to be used throughout many different games, what sort of development occurs over time has yet to be revealed; until today. Today Nintendo released some new information on the Mii channel (they will be releasing information frequently for the next 7 weeks to help build hype for the console's release).
Mii characters also have a sort of AI, they can transfer themselves via the Wii Connect24 through to other Wii systems, and from there they can visit other Mii characters within the Plaza setting for the Mii characters. The channel behaves very similar to what can happen in Animal Crossing, but not exactly the same; it seems as though the whole cultural exchanges thing which exists in Animal Crossing will exist in the Mii channel as well: For example, over time, the characters spread their habits onto other characters without the direct intervention from the players. In animal crossing, when characters travel to different towns, they can spread the culture/habits which they received from the previous town into the new one; and, of course, the player can play a large part in the habits of their villagers, and so therefore can spread their culture and habits accross the globe via the Nintendo WiFi network.
Anyways, from there, the Mii characters can appear within the games themselves as characters other than the main characters in the game, for example: Animal Crossing, the character could appear within the town as a visitor. In Wii Sports, they can appear as spectators. Similarly, they can do this in your game as well. It seems to be that this occurs with those characters who have not been used in a while. An old Tennis Champion might frequent the tennis games played in the future on your console, or that of your friends; perhaps they will give newer Wii created Tennis players advice? Who knows, that is just wild speculation =P
Just for clarification, there is space for 48 different Wii channels. I do think that is more than enough space for most people, I would imagine that it would be expandable in the future by having sub-channels if anyone required it: since through the memory expansions the amount of storage space is essentially limited only by how much the player is willing to spend on the storage devices. Speaking of which, I am very interested to see how much those SD memory cards will cost for the Wii; not that I will need one for a little while, I don't plan on loading the internal drive up right away; my Xbox hardrive is still only like 5% full =P