But the shortage isn't really over in terms of how quickly Sony is producing the system. They are still now, at this time, well short of the original number of systems that they had wanted to release between Launch and Christmas.
And, as pointed out, many scalpers who were unsuccessful on ebay have returned their systems to the stores. And while Sony has been shipping more systems out since Christmas, most stores only get a small handful at a time, and that handful just sits there for the most part.
Generall speaking, Nintendo is still shipping out a lot more Wii's than Sony is PS3's, and the Wii's aren't even hitting the shelf because they are selling so quickly. Is the price a factor? I'm sure it is. However, I also think that there's something much deeper than just price going on here. I think it's the fact that Nintendo has come up with something, new, unique, and fun is a big part of the reason. Whereas other game high-def and graphics bragging rights, the games for PS3 aren't much different than those for PS2... in fact the controller is almost the same.
As for the launch line up, I'm sure the lack of any good games is not helping Sony sell the PS3s any faster. However, as I recall, the launch line ups for PS2 and for Xbox 360 were nothing to brag about either, but those systems still sold like gang-busters at launch and well past their respected launch-time-frame holiday seasons, and did very well on ebay during that time.
And as for the Wii, other than Zelda (and maybe Wii Sports, which comes with the system and has been getting excellent reviews), most of the Wii launch line up is nothing to brag about. Sure, there is definately some fun stuff in there, and I even have a few other games for the system, but most are nothing to brag about outside of Zelda.
And from the sounds of it, many 3rd party companies who were going to make certain titles exclusive to PS3 are now planning on releasing their games on other systems (no doubt due to them needing to sell a certain volume of games to make a good profit, and not having much potential to do so with PS3 with it selling much more slowly than expected). Virtua Fighter 5 from Sega was going to be PS3 exclusive, but is coming out for 360 later in the year. There's rumors that the new Metal Gear may not remain PS3 exclusive. And if the system doesn't penetrate the market sooner, then many other 3rd party companies may follow suit (and if one of those companies ends up being Square-Enix, that will be a HUGE blow to Sony).
So yeah, you are right, there's not many great games at launch for the PS3. And if this trend of many of the games that would make PS3 great coming out on other systems happens and continues on, then there will be little reason to get the PS3 later on when you can play the same games elsewhere on systems that some people already own and are cheaper for people who don't own a newer system to purchase.