You may consider "everything else" to be fluff but to me it is essential. Those features don't just make me "accept" Steam, they make me love it.
Exactly, so Steam has been successful. Though I do wonder now what you consider the word 'love' to mean.
Steam has made my PC gaming experience far more enjoyable than it used to. Part of is the convenience of having all my games centralized and easy to access, but most of it is how I interact with my gamer buddies on Steam.
As nice as the community features are, I argue they are fluff because Steam could easily exist without them. But in the way they attach people to the service in order to enjoy community interaction (a basic need for all people), it is very effective in breaking through the acceptance barrier of many a gamer. If gamers depend on the Steam service, it puts the provider of the Steam service in a stronger position to push on the consumer more things that benefit the provider or its associates.
As for having all your games centralized, are you implying that you don't have any games that aren't on Steam? I have a hard drive where I install games and in the root directory of that drive I have a folder called "Games". In that folder, all I store is shortcuts to launch games. Some of those shortcuts are even customised, for example to launch the game in windowed mode at a particular resolution. I use Windows 7 (and I know the following can be done on winxp too) and have a toolbar on the taskbar that is just the contents of that folder. Launching any game is a matter of 2 mouse clicks.
Why am I telling you this? Because I find this to be more convenient than attaching non-Steam games to Steam and using it to launch them, and also I don't like cluttering up the desktop with millions of shortcuts and hate using the Start Menu. In simcity4 for example, I'm using a mod that uses Shift+TAB as a shortcut for something. But if the game is launched from Steam the Shift+TAB shortcut brings up the steam community.
Apart from that, I'm not much aware of what it means to launch non-Steam games through Steam but unless I'm missing something, it seems to be mostly pointless.
I won't even get started on the crazy deals. So yes, I buy games on Steam, and that is one of its primary functions, but I pay far less for them now than I would have in the past (12 dollars for the entire Company of Heroes collection, for example).
The fact that games are cheaper when they are not so new is not something new about the games market. I have argued in the past that digital distribution has impacted the way video games (PC games in particular) are priced, increasing the speed at which games drop in price, but that is something to be attributed to digital distribution in general. Obviously there are fewer costs to a seller in distributing a purely digital product, than distributing a physical boxed copy with all the shipping, storage (inventory), shelf-space etc. costs that go along with it.
Look at the price of Civ5 on steam. At least where I am, it's costing 80 USD to order it on steam. Alternatively I can pick up the identical game in boxed form from a retailer offering it for roughly 46USD (postage included). That says a lot. This is perhaps a good time to remind you of the often-stated argument of those defending steam - Publishers set the price. You like the fact that you picked up the CoH collection so cheap. That's the publisher you should thank - not Steam. If Steam didn't exist today, any digital distributor that filled a similar role would likely offer you the same price.
EDIT:
Dunno if I agree with that though. Major big-budget games have been selling on Steam for a long time now.
Indeed (agreed), and games don't need to be
steamworks to have steam drm. Correct me if I'm wrong but Civ4 on steam never needed a disc in the drive.
On the other side the DRM is 100% non-intrusive (less intrusive then having to insert the original DVD), the games selling part is great (and special offers are sweet) and "everything else" is a lot of stuff
100% non-intrusive? Seems to be completely a matter of opinion. I'm happy for you that you find steam drm acceptable. I find its drm acceptable as well but I don't consider it to be 100% non-intrusive. It is at the very least a small nuisance. For me putting a disc in the drive is a similar level of nuisance. It's not as if I'm playing a different game every day, so it's not difficult to leave the disc in the drive. I mean, I don't often hear console players whingeing about how they have to put a disc in the drive or a cartridge in the slot every time they want to play a game (let's ignore for the moment the possibility of console gamers buying every single game digitally because I'd imagine that is extremely rare). They appear to be perfectly fine with it.
With other games that use a disc-based DRM, I don't have to manage an account with some overseas company like I do with steam. I don't have to sign an agreement stating that my service could be cancelled should I negatively affect the enjoyment of the service by another of its users (for example), and worry about the terms of that agreement changing at any time with my sole remedy should I disagree with those changes being to cancel my subscription and hence lose access to games I paid for.