I had a coworker who was a game programmer in California before moving to New England and finding his way as a defense contractor. He preferred defense contracting, by far. He told horror stories of death march after death march for less pay than as a government contractor.
But what I referred to was that it's not that cut-and-dry. You can work for two different companies and have different experiences. It's why I named Valve in particular: I would be willing to state, despite no knowledge of their work environment, that the people there love working there. It comes through in their games.
Oh, I'm sure there are differences between companies. However, your measure of "people love working there" might be misleading. All of my ex-colleagues loved working on games, and almost all were pretty happy at the company, because, you know, the previous company they worked for had worse death marches - 7 days a week, not 6! and from the start of the project, not just the last year of development! - and wow, our company paid up to GBP 7.50 for takeaway dinners when you worked more than 11 hours that day! Plus, the previous company went out of business and didn't pay the last 3 months of salary, whereas this one was still hanging on.
I don't know exactly how it happens, either that people talk themselves into being grateful for their situation, or they just drink enough game industry Kool-Aid to not see how it's completely broken.
Don't get me wrong, I don't regret working in games for a year - I'd almost certainly be wondering what professional game development was really like if I hadn't. I also don't know if the leap into self-employment had come so soon or at all if my quality of life had been better at some other job. In any case, I'm glad to have left that behind, and glad to have done it when I did.
Plus, I discovered I like programming more than I like game development, which means that I'm actually working on more fun and interesting stuff now - although my job at the time was tech/engine programming, most of it wasn't actually that challenging; I wasn't solving interesting problems. There's a lot of reinventing the wheel (and the bugfixing that goes with it) in the game industry...
Oh, and by the way: getting into game development as a competent programmer isn't nearly as hard as they like to make it out to be. (I was also involved with recruitment) I'm guessing they have to maintain that air of elitism to keep people interested. If you're itching to work on games, I'm not going to try and talk you out of it; you'll have to decide for yourself if that kind of life is for you. If you have a wife or girlfriend you'd like to hang on to, I'd make sure your notice period is short, though...
Valve may be great. I don't know, but from what I've read online and heard people talking in RL (and not just from my coworker I mentioned above) I'm inclined to believe that if Valve is great, it is an exception, rather than the rule.
