Of course its them being smart. The most financially profitable thing George Lucas did with the first Star Wars was retain full rights of the Star Wars franchise. So in the G.Lucas vs. Fox equation, I would rather be on the G. Lucas side of things. And while chances of an indie game exploding like Star Wars is pretty rare, I would rather be protected in the event it does so my IP doesn't get pasted on a million coffee mugs for someone else to profit from. Plus, this closes off a lot of potential for the developer as well. For example, if the game is doing moderately successful and some larger company offers to buy it, we legally cannot sell them the art resources since we do not own them.
True, however, you can't always decide which side you're on. Lucas is on the side of the creator in that example and the creator should always get credit for their work regardless if it's the coder or the artist. I think you misunderstand copyright though. If an artist were to take a piece of art and market it as anything except an example of work they have done and try to use your game's success by selling merchandise, i.e. "Get your official WoW mugs here!",would be something you could sue them for. They don't work for the company and they don't have the rights to market the brand. Therefore, they would be in the wrong. You own the IP to the game, the concept of the game and all representations of the game. They own copyright to individual art assets and not even the models they're making look pretty. I don't know about you but raw art skins look pretty ugly when not applied to the model it's intended to go on and that's all they'd have to work with. Concept art is a different matter as it's often used as marketing material and such. However, the artist can still only pass that out as examples of what they've done. They don't own the IP rights to the game nor the game name or anything like that. Coming to an agreement that you can use the assets for the entire project ensure you have enough flexibility to use it how you need and provides enough assurance to the artist that you're not trying to use it for anything other than your stated goal. If you want a free reign license then it'll cost ya.
Which kind of leads back to the OP's original statement. Since it sounds like the norm for freelance artists to retain the rights to exploit art bought and paid for by the developer, maybe developers are looking for a bit more vested effort into the project. From a business standpoint you have two main factors: The Worth of the Art and the Worth of the Code. Are they equal? Is one worth more than the other? How many successful games would still be successful if they had a different, but just as talented, artist/programmer? I feel that most games are played and purchased due to the game (code) and not the visuals. Dwarf Fortress is played by a surprising amount of people, despite having no graphics. And I think Angry Birds would be just as popular if they had a different artistic rendering of the birds.
Of course, we all want good art for our projects. We just don't want to be like Fox and kick ourselves later.
Eh, I tried to play Goldeneye on my buddy's Nintendo 64 last year and it gave me migraines. That's an awesome game but I simply can't look at it anymore. In that respect I completely disagree that people play games for code and not graphics. Now, both are equally important to the success of the project. You can't have just pretty pictures and you can't have just a well-coded game. It's a black magic sort of mixture for people to play.