It's this simple, and yes ERTS has the leverage over MSFT:
MSFT's money makes them an 800 pound gorilla in the software market. You spend upfront for the software development, you give it away and being a non-physical product it stops costing you money (for the most part).
Consoles cost money, ALWAYS. You can't develop a console then give it away to "throw your weight around" (i.e. money), just aint gonna happen.
Nevermind that MSFT is a newcomer in a market that's established and they don't have a presence in. Unless MSFT wants to start paying BIG money to stores, devs., pubs., etc. in order to get them to do things they wont do merely based on MSFT's money in the bank (which they wont) then MSFT has to struggle like any other company. The main difference is they can get a jump start by buying a few devs. (done) and can afford to take loses while the console infiltrates homes (done). Beyond that they had no leverage and still, to an extent, don't have much leverage. Certainly still less than SNE, Nin., and ERTS. They are not the big boy in this industry and all the money in the bank wont change that or allow that.
So as jamok said, it's most likely MSFT conceded more than ERTS, though i'm sure there was some ground given by ERTS to get onto LIVE; but not much.