Let's say that instead of a video game crash in the mid 1980s, the market sorted itself out like it did in the mid 1990s when there was a similar glut of systems. I know the conditions in 1983 and 1995 were very different, but they had two things in common: a glut of systems, and lots of shitty games. This manifested in the 1990s mostly on the less-popular systems, like the CD-i, Jaguar, and even Sega's addons. But let's say something similar happened in the 1980s. Instead of a crash, let's say the shitty games simply sold poorly and went by the wayside, with the market carried on the good games. There were good games back then (a great deal of them were arcade ports, but many weren't).

Personally, I think there would be some differences in today's market, but it would still be mostly similar. The fly-by-night developers that mostly peddled refried shit would have gone out of business, and the third parties that pumped out mostly good games (such as Activision and Imagic) would have probably survived longer. The ColecoVision would have done much better; it was emerging as the leader of the "2.5" generation, and with more time would have been able to build up a larger market share. One reason for the crash is that the Atari 2600 market was saturated and many low quality, rushed games appeared on the system. The 2600 probably wouldn't have died off in 1983-1984, but continued on for several more years. With the market moving to the next generation systems, a lack of a crash would mean there was no post-crash "reboot" for the 2600 ("The Fun is Back" no more!) and the 2600 would have ceased production around 1986-1987.
By 1983, Atari had started fucking up and there is no reason to expect that the 2600 would have out-competed the ColecoVision. By 1984, the 2600 would be starting to die, the 5200 stagnating, and Coleco would take the lead in the market. By this time, the Famicom (NES) and SG-1000 were out in Japan, and with a video game market that was still alive in the US, all likelihood is that both the Famicom (possibly renamed as something else, but probably not the NES) and the SG-1000 would have seen '84 releases, if not holiday '83 releases. The Famicom wouldn't be marketed as an "entertainment system", it would more closely resemble its Japanese original. It would have probably seen success, much like it did anyway, although it would have probably got 75% of the market share as opposed to 90%. The underpowered SG-1000 would still have been replaced by the Master System, the ColecoVision would probably have been superceded by a new Coleco console. By 1986 Coleco had a very successful line of Cabbage Patch dolls, and despite the worthless piece of rancid dog shit known as the Coleco Adam, a more successful 'Vision would have done wonders for the company. A four way console race would have likely been unsustainable, and Atari would bounce along the bottom much like the did in real life and die in the '90s. Nintendo and Sega would likely take over most of the Famicom era market, with Coleco being in third, maybe 10-15% market share. Eventually, Coleco would have died out as well; I just can't see them beating Nintendo or Sony. But I could definitely see Coleco lasting into the '90s. If nothing else, the PlayStation would have got them.

What's your take on it?