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Think really hard for a moment of the most iconic female game characters out there. Who comes to mind? Lara Croft? Princess Peach? Zelda? How about any of the characters from fighting games like Chun Li, Ivy, or Kasumi? Almost all of these women have been incredibly sexualized, and if not, they take on an incredibly passive role in just about every game. Women in games are treated pretty much as eye candy or as objectives to save.
There are typically two defenses to this accusation: the market or that men are also portrayed in impossible physical standards.
First, many tout that the average gamer is a white, young adult male. Attractive female characters draw them toward a specific game much the same way that Megan Fox is the only reason The Transformers sold tickets. Unfortunately, this defense rings false: It shows the awareness of why something exists but not the desire to change it or rise above. Further, it is based on primarily false information.
Forty-two percent of gamers are women over the age of 18. If you think that they aren't hardcore or playing the same games you are, that's because they wear what reddit user GumboVision refers to as an electronic burka. Women are afraid to show any gender identity for fear of being immediately villified, berated, or fawned over instead of an equal. (Yes, being fawned over is just as bad, if not worse.)
We need to grow up and recognize that there is a strong fan base out there besides young men. I'm not saying these portrayals shouldn't exist all together. It's obviously a niche product that sells, but it shouldn't be the primary focus of every damn game. As our audience matures, so should we. Overly sexualized, bland portrayals of women should be outliers instead of the norm.
The second defense is demonstrable. In gaming, men are often proportioned just as outrageously as women. Just look at Kratos or any of the guys in Gears of War. They have 10-pack abs. They decided to forget six, went for a baker's dozen, then shotgunned three of them before smashing the cans on their huge heads just to show how goddamn manly they are.
Unfortunately, though, that's about as far as this defense goes. In games, men are generally the ones with more fleshed-out personalities and generally have more clothes on. Their appearance also tells great stories about their character. How Jim Raynor from Starcraft stands and carries himself tells us of the great personal burden he has been through as well as his no-nonsense personality. If you get in his way he will kill you.
Or even look at a comparison of two characters in the same game. Street Fighter's Ken wears an outfit that shows us someone who is disciplined yet walked away from his life to go explore the world. His clothes are frayed at the edges from his rough journey, and his hair is ragged from not being groomed.
Now look at Cammy. We can figure out that she is probably British, hails from a military background, and never learned the advantage of pants or a shirt. Her stance conveys to us that she has a particularly nice posterior that she enjoys showing off.
It becomes obvious that men are there for the fighting while women are there to show off. It's a strange dichotomy in the treatment of the characters.
That isn't to say the gaming industry hasn't taken great strides in its representation of women, however. Just look at the latest character model of Lara Croft. She is proportioned like a real person and her clothes certainly cover more flesh. And she will cause you pain. Holy hell, she will just by looking at the trailers. She will survive a shipwreck, bandage herself up, then she will First Blood you until you're dead. That's exactly what her stance and her appearance convey.
Other notable examples of positive portrayal of women are Chell from Portal, Jade from Beyond Good and Evil, and Alyx Vance from Half-Life 2. So it's not all bad, and developers are even getting comfortable enough to be self aware of how women are portrayed in the form of Bayonetta. It's taking a while as we haven't quite seen the gaming equivalent of a Jane Austen yet, but it's definitely something that is being worked on.