This generation should be short anyway because the hardware is under powered and because the last generation was too long

Currently hardware is less and less dependent than ever. It becomes harder and harder to take advantage of all the processing power of a GPU after each successive generation.

This generation is just as adequately powered as the last. Both represented the computing power of about a $500 PC at their respective launch times.

VR is going to be a big deal and the current gen consoles are not powerful enough to do much with it

I agree that VR will be a big deal, however this would point against the consoles launching in 2017. Several Early VR headsets are launching in 2016. This isn't enough time to implement a polished VR feature into mainstream a console by 2017. The markets are too different currently. It takes over a year in most cases to develop a console. Any console released in 2017 would not take advantage of VR, unless they had already been developing it (no indication of this). Waiting until 2018 or 2019 would offer more time for the VR market to become refined enough the mass market of consoles, in which case waiting is a huge advantage to console makers.

Backwards compatability is much easier to do on the x86 architecture meaning that people wouldn't feel like they were missing out by upgrading (the main motivation to buy the 9th gen initially would be VR)

People don't need to feel like they are missing out by upgrading, consoles (mostly) always had backwards compatibility and it hasn't effected their release dates in any sense. If anything by releasing consoles so soon together, you diminish the trust you have with your consumers, as they feel like you just punished them for being an early adopter of their previous generation.

I would also argue this points to the decline of console's altogether. What if Microsoft decides to start marketing their surface as able to play "portable xbox one games?" Its capable of doing so.

AMD will probably provide the new GPUs and the Arctic Islands architecture + DX12 will be such a huge leap over what is in the consoles currently for both 2D and VR that it just makes sense to time another console generation to take advantage of this leap, otherwise the gap between consoles and the PC will be ridiculous again

The console gap between PC and consoles will always be large. A gaming PC costs more than a console does, and continues to develop throughout the life-cycle of a console. Consoles are less concerned with raw power, and what architecture is being released, and more concerned about the market and profit.

TLDR: Your main arguments for consoles releasing in 2017 have to do with taking advantage of VR, However in reality these companies will wait until after the VR launches of 2016/2017 to gauge the market's perception of them and to perfect the tech. Its too big of a risk your entire market segment on VR that you don't know if people will like, so they will let Oculus and others mitigate it. Microsoft and Sony have only recently been acquiring companies relating to VR software, and none yet relating to VR hardware. Development of VR Hardware will cost another year without a major acquisition, with an earliest release of 2018