I don't see why technology can't move one without leaving people behind. Isn't it even more progress if you can make something that's also playable on older machines? It certainly sounds like it would be much harder.
And Jed pointed out another example, in which you'd use your computer in a way more similar to a TV, and the game would be somewhere else. That's also technology, and it's more accessible.
I don't think it's stopping technology or anything. I think technology can progress with a specific goal that's not just "get bigger". I love technology. I love lots of things about it. I have a mp3 player than doesn't require electricity, how cool is that? I know I keep rambling about it, but I just can't get over it. That's technology, too.
So I don't think it's just a matter of technology advancing or slowing down, it's more about the direction chosen. I personally don't think that graphic improvements are that much of a progress. I don't feel that the games are much improved. If you have a puzzle that involves the shadow, then by all means have a shadow (not that you need to be high-tech to have a shadow, lots of old games have them too), but otherwise, I don't think it adds anything at all, and it takes away something: the ability for most people to play.
So the way I see it, it's a decrease. It's less good. It's not getting better at all. And when it's done just to attract consumers without having to create a decent games - just like some movies do with special effects, and make a movie that is nothing special but oh, look, shinny special effects! - I definitely see it as something that goes against progress.