The console itself being a controller would present a lot of complications , you would have a lot of people out of your system ( and you want people spending time on your platform playing and buying games etc ) whenever the controller is out of order. You want to make it as comfy and easy as possible for costumers so that they remain in your ecosystem and not the other way round.

Having controllers as a separate accessory is always better to make money , people buy on average from 2 to probably 5 controllers throughout each console generation. It makes more sense having a smaller hardware that connects to your screen with separate controllers.