If you buy a game for $25 when you wouldn't have otherwise bought it at all, you're putting money into the publishing executives' wallets, not taking it away.
To the publishers, that is all 100% a good thing.
Down side is how to you then deal with the people that would have paid $50 seeing their mates paying $25 for it? No one is dumb enough to want to pay $50 when they can get it for $25. The CD key is from a legit copy, the store/shop is valid (ie: pays taxes, buyes stock from approached wholesalers, is registered in the country they are located in) ect.
It is like driving to the next state (or coutry if on is near by) and buying over the counter what you want cheaper than back home. Now though, with the internet, everyone is next to a border and so the numbers of people doing it increases, which does draw the attention of publishers and makes them want to do something to stop it (be it ethical or legal). Region restrictions or price fixing is, at it's core, wrong. But it is why they say the price difference is based on different operating costs in each country and the spending power of the general population. Of course, no business is going to open their books to the public to allow them to decide if that is a fair call on the businesses side.
Chasing the lowest price, both for businesses and customers is not a long term sustainable path. But how to change it in a way that will work and not let some middle man become fat on giving false promises is beyond me. All I can do is make my life easier by spending money smartly and not artifically restricting myself to a belief system where I open myself to abuse. ie: do not think spending money on "green" items will lead to a better future. Do not buy items that look like they will break after a weeks use ect.
It takes a massive change at the customer level to make businesses change or for governements to enforce new policies for the better of the people, but they all cost, and someone needs to pay for it. Either willingly or by force. Free Trade is nice on paper, but bad when taken with a unbalanced playing field (ie: crop subsidies, forced labour, strip mining ect).