Sequels are a means of expanding a story arc. I don't see you complaining about the Fallout series, or the Elder Scrolls series, or the Final Fantasy Series, or even the Pokemon series for that matter. I buy sequels because I like the ever growing story in the series, such as Halo. I have always enjoyed the Halo universe, and I will continue to enjoy the Halo story.
As for the car comment by SS89, it's the same kind of deal. Car manufacturers keep making new models of cars because older ones either become obsolete, or because they came up with a new idea to put in the car, or because they need to step up their place in the vehicle industry by producing a similar product. The same goes with video games. Halo 3: ODST added the Firefight mode, which was quite the addition to the Halo series. Sure, the similar "Survival Mode" has been visited in many past and present games, but maybe Bungie wanted to give Halo fans a taste of what they could do with Survival Mode.
People demand more from game developers. Have you seen the size of the Star Wars industry? Hundreds, if not thousands of books/graphic novels, seven movies, and so many games. These exist because the people demand it. They want more of a back story to the universe of Star Wars. Activision isn't going to stop making Guitar Hero games because people want more of them. Sure they're getting a little out of hand (last year there were seven Guitar Hero releases), but the public still demands it, and Activision is still making money.
As for this year's E3, the Microsoft Press Conference was a disappointment for me. I was expecting the developers to actually talk about their games, not come on stage, introduce themselves, tell us the name of the game they're showing, show a trailer, and then leave. Most of it was about Kinect, which saddened me. Kinect is a great idea for the casual gamer, I'll leave it at that.