I think that if the value of BTC in 'establish currencies' continues to rise (trend - not spike) then what you are suggesting should be negated for as long as the trend continues.
The other thing to remember is that, people without dedicated miners will realise that running a non-dedicated machine is no longer efficient and slowly start running their miner less and less. This will in turn make the difficulty drop and in turn make mining for dedicated boxes more profitable.
My 0.02 BTC.
JG
This is my point exactly - people who are not efficient will be squeezed out of the market pretty quickly.
Also, as I laid out in my post, the only reason we would see an uptrend in BTC is that demand continues to grow. The currency's value is entirely demand driven.
Given that we are now at difficulty .877 million, and the average rate of difficulty increase over the last 8 months has been about 55% per two weeks, we will reach difficulty 10mil+ in 13 weeks. At that point an electricity cost of just $.15 / KWH is going to be enough to make mining unprofitable on a machine that nets ~2Mhash/W (2x5870).
Absolute rig size is not so much the determining factor as compared with hash rate per watts consumed, and the administration effort of looking after the rigs.
My dedicated mining setup is 6x5770 on three motherboards with three power supplies and one UPS. My Kill-a-Watt measures 850 watts total drawn by the UPS and I get 1200 MH/sec with overclocked GPUs. The rig is designed for optimum power efficiency given the GPU cards that I could obtain. Although I live in Austin, Texas and subscribe to our local utility's green power, i.e. wind power program, the cost of electricity is .085 USD per KWh, or about 1.73 USD per day. Despite the 100 degree F days, I situated the rigs in the crawl space under my house, and enjoy a steady 86 degree F ambient temperature without air conditioning. I have configured the software, linuxcoin, to automatically restart in case of communications failure with the pool, namely BTCGuild, therefore I do not need to physically access the rigs much. I use the pool's account page and the Google Chrome web browser Bitcoin Mining Monitor extension to check mining worker status from time to time.
The air conditioning point is important. For many home miners, running the rigs indoors, the cost of air conditioning adds to the cost of running the mining rigs.
I hope to be among the last to unplug my mining rigs - liquidating the components, when it becomes unprofitable to mine bitcoins with a GPU.
I gave the 2x5870 as an example of a rig that would get around 2mhash/w when properly configured. It's the most power efficient card for mining.
You happen to live in an area with cheap electricity, so mining will be more profitable for you in the long run. The national average for electric is around $.15/kwh which is why I chose that figure.
