Nels is crazy. Story given the backseat to gameplay? The problem with most modern games is that it's vice versa: shitty gameplay because the focus was given to a "good" or "epic" story. Not that good story has actually really happened in games yet, possibly with the exclusion of something like Planescape: Torment.
If videogames are to be classified as an artistic medium (I don't think they should be, they're a craft, not an art), then the constraints that the medium allows in terms of expression are what make storytelling possible. For instance, Portal's story is twofold: it's the escape from the complex and the interaction with GlaDOS, but it's also the experience of using the Portal device and the story you tell yourself as a player. That's something Valve has done a great job of understanding and taking advantage of, by the way.