Honestly it is a cross between them sometimes. The game you really want to make may require a lot more resources (money, time, etc...) than you currently have. So if you have time to make some simple games that are following whatever the current popular trend is, then you may be able to make enough to get yourself to the point where you can make the game you want.
The other side of this is that you often don't have the skills when starting out to make your dream game. Creating multiple small projects is a great way to get your skills there. And if you are already making smaller games, why would they not try to put them up on the markets?
Though it does have the possibility of causing more flooding of lesser quality games. I also think it means those games that are well built and polished will stand out even more in the sea of mediocrity.
Just my 2 cents...