I agree, it's a long term play, and their chance of winning over hardcore console users is zero at this time. However, they will be directly competing with consoles for space under the television.
As for solving your problem with hardware confusion, they could have manufacturers ship Steam Machines with some kind of rating system. Remember how Windows had those performance ratings for memory, processor, etc? They could do something very similar. You look at a Steam Machine, it says processor 5.7, memory 4.5, graphics, 5.1. Then you look in the Steam game library and see a certain game recommends graphics 4.5 or greater. Or this indie title plays great on anything 3.4 or higher. You use those numbers to guide your purchase.
Changing hardware will come to their advantage though. Xbox and Playstation will ramp up over the next few years, and we'll see some improvements and major titles heading their way. However, what's happening 5-6 years from now? Xbox and Playstation are dated, Steam OS has the bugs worked out, and Steam Machines are available with the latest advances in hardware. Where are you going to buy Call of Duty now, for your 6 year old console, or pickup a Steam Machine that can run it twice as fast, at Ultra HD resolution? That's going to be a big plus for Steam, and if people are buying in 5 or 6 years from now, they're less likely to jump on the next console launch, since they already have powerful hardware in their living room.
Another huge plus for Steam in the living room is Oculus Rift. If it's released below $300, and exclusive to the PC and Steam Machines, they have a unique experience the consoles can't offer.
Nothing is short term, I think Steam Machines will make a crawl the first few years, but I think they're going to be pushing to replace consoles, and I think they might succeed. Cheap games, big sales, Oculus Rift, low cost or high performance hardware to choose from, and eventually an open store available for anyone to publish towards.
Edit: Oh, one other huge advantage. They're backed by every hardware manufacturer they get involved. Dell is going to be dropping flyers in every mailbox around the world, with a couple of pages showing off their Steam Machine line-up. Dell wants money, and if Steam Machines succeed, they get rich as well. PC sales are down, they'd love another piece of hardware to sell. Get every other hardware company doing the same, and that's a lot of free marketing.