Imo pirating itself doesn't hurt quality games that much ... but then again, there are all sorts of pirates.
Some sites actually have ads with "why pay for games, get them here free bla bla". Now THAT is hurting every one. Playing a game and pay for it afterwards because it's a great game doesn't, neither does buying games from the budget-bin because one thinks games are overprized.
On both these cases, no more/other games would be bought anyway.
People that finish every game released and enjoy most of them and never buy any game do, the so called warez-kiddiez.
I've got about 30 NDS games, some still in foil
, but I also got 3 moving boxes full of "old" pc boxes, I'm one of those people that's collecting all the classics. I just love browsing through boxes and manuals to relive them a bit.
Point is that there are so many crappy games these days and developers expect them to sell ... most is dumped on piracy because they don't. Sure, without piracy they'd probably sell more on commercials etc. But that only works for a while. If there was no piracy whatsoever, I'd bet people would wait for a few months and try them out at friends etc and would buy even less games in general compared to now. At least with piracy you can play the game and see if you actually want it, deem it worth your money. Ofcourse not everyone thinks that way, and some people got loads of money but are too cheap to pay for a game that's a must-buy.
My 2 cents.