It is technically possible to convert win32 (based games to xbox and the degree of work to do it is based on your products articheture (we looked at converting some applications we do). If you used Visual Studio and DirectX in some cases it can be a fairly straight forward. A very basic document on developing for Xbox 360 is available;
Actually the biggest hurdle is the high license fees that Microsoft charges. In order to do the development you must first license all developers to use the Xbox developers kit, and be under a Xbox developer support agreement. Then when your product is actually ready you must have a specific distribution license to distribute it for Xbox.
The companies that make the various game consoles really don't make much money on the boxes themselves (some reports are that they actually just break even). The make the money in licensing others to develop games, accessories, etc for the consoles.
Someday, I might put a cute statement here.