Its got nothing to do with security really, its more that to 'emulate' a system which you have to do if you don't want to original machines owners to sue you off the face of the planet you can't use any proprietary code, so you have to make a program that does everything the hardware does, but using software and using a completely different method to the original. This is incredibly system intensive, and at the moment home systems don't exist that could 'emulate' a 360 or PS3 in this way because they simply don't have the raw processing power required to emulate this kind of system.
It might be done eventually, but not with the technology thats available at the moment.