I think it's very wise of Microsoft to want to stop self publishing, because to paraphrase Microsoft's quote in this article: "Most Indie games are shit and hardly anyone plays them." I consider myself to be quite a hardcore gamer; more so than anyone else I know, but I've never been on the Xbox Live store or XBLA or the Indie section or any of those things and have never spent money through Xbox Live. The majority of people who own Xboxs don't even know about the Indie section, let alone actually go on it, let alone actually see anything they want to buy.
What I understand from reading this article is that Microsoft want Indie games, but they also don't want any old game that's been made, in case it's not very good, so they're trying to find a way to monitor and possibly approve certain games if they think their good enough. This, I believe, is a good move. It will immensely improve the quality of games that are available online.