Wow, there's a lot of nostalgia in this thread.
Let me start out by saying that, yes, games have gotten easier. There are several reasons for this, but the primary one is that most people do not like the difficulty of old nintendo games. An extremely hard game is made for a niche market.
There's also the fact that many people who've been playing games since the Nintendo era have simply gotten better at games. I blew through Devil May Cry and Devil May Cry 3 on normal, hard, and Dante Must Die. I love the difficulty level of God Hand. I play bullet hell games for fun. However, I've been playing video games for 23 years. I got my start on the Commodore 64 when I was 4. I've been playing for a very long time, and since I have diverse interests, I have strong general skills in any sort of game. I don't demand that companies cater to my wish for difficult games, because I know that's not what sells.
That said, 'easy' does not equal 'bad.' Okami is one of my favorite games, and I blew through the game without dieing once. A hard game can be frustrating and completely unfun, while an easy game can be a joy to play.
The best solution is the inclusion of difficulty settings, but often times you just get the 'enemies have more HP, you get less ammo' solution rather than 'enemies get smarter/get new attacks'.