Have you ever watched a movie? Notice the entire screen is not presented in focus. The focus on close objects makes the distant objects appear blurred. This is done for artistic effect, but it also simulates the way your eyes work naturally. When you look at someone you never see the entire scene before you in 100% focus. The focal point is the subject you're looking at while the rest is out of focus. This is natural and honestly simulating the way your eyes actually work enhances the realism factor.
It's an arbitrary contruct because it's not natural with the point of focus like I've said. You've bought in to it, great, but it's not natural at all. Purely dismissing that my beef with it doesn't make you correct.
The reason videos are that way is that unless you are extremely far away and shoot everything with a zoom lens, cameras have the same exact limitation as your eyes. It's also not natural either because you *never* experience situations in real life where you shift your focus and are unable to focus on arbitrary depths. You just happen to be used to it after years of watching TV, movies, etc.
Until my vision can be tracked and the proper depth be placed in to focus, it's just another distracting construct like motion blur that immediately gets shut off.
I challenge you to find a real vision situation for a person with normal vision, at distances greater than 1' where you ever look at an object and it is not in focus. It doesn't occur because your eyes focus.
Next are you going to argue that everything but the centermost bit of the screen should be blurred since that's also how your eyes work? On a related note, this is also why we never perceive depth of field effects. We see so little of our area of vision clearly, that anything other than the spot we're looking directly at is little more than a blob that our brains are really good at filling in. (and as you move even farther from the focus of your vision, not only do you lose clarity, but you also technically lose color, except you don't know it, again, because our brains work amazingly.) See here to get an idea of how small an area has cones (which are the only one that perceives color)
http://hyperphysics.phy-astr.gsu.edu/hbase/vision/rodcone.html
The only time you actually percieve any depth of field effects are camera images because they can only capture a certain depth in focus. It's a totally artificial construct that you happen to prefer, but it really has no basis on how we perceive the world around us, unless all you do is look at pictures, and watch TV.
Here is a fun thing to do. Take a look at paintings that have great variation of depth and see if you can find deliberate depth of field effects in pre-camera paintings. I'm talking paintings that are trying to be realistic, not watercolor blobs, etc

You are correct in the claim that it is technically how our eyes work, in a static environment (if one lacked the ability to focus), but it in no way is how we see the world after you factor in the continual focusing, the bits our brains fill in, etc.
You want the games to look like the world does to you, well, you need the whole thing to be in focus, and the proper field of view with the proper distance, because all the limitations your eyes have will come in to play and make it look just like things do in real life.
Ok, I've just realized one situation where depth of field effects seem natural. As I've been playing Sniper Elite v2 this is fresh on my mind. When you're looking through a scope, there are depth of field effects, and that is a case where yes, that's accurate because that's a limitation of looking through a lens that isn't nearly as flexible as our auto-focusing eyes.