In 2006-2007, we saw that happen with SecondLife, as many developers (myself included) built software code that could run within the SecondLife world but was ultimately stuck there because you could not run it outside that world and/or run SecondLife servers on your own machines.
in 2007-2008, we saw that happen with the F8 Facebook platform, which locks your applications inside of Facebook and, while many developers have pushed to force the company to open up, tends to stay there. In 2007-today, we’re seeing the same thing with Twitter, which allows you to build whatever you want on top of it but doesn’t decentralize their approach, leaving developers potential slaves to the whims of the company. The same is true of the iPhone, which provides unusual access to the phone operating system and allows to develop interesting software on top of it but still keep developers away from being able to access basic things like calendar information via an SDK.
Another example I would add of an extensive “Walled Garden” infrastructure is the RIM-BlackBerry ecosystem of software and hardware.
Arguably, “Walled Gardens” tend to be successful (arguable because of “survivor bias” eg. we hear about the survivors, but not the failures which number much more). But one thing is certain: flowers planted in the garden tend to stay there.
And yes, I too am having fun playing in my garden :)