Well, the term indpendent is fine. I sometimes refer to the GOAT Publishing games as independent as well, but I also sometimes refer to them as homebrew. You see, independent can mean a lot of things. A limited private pressing or production run of a homebrew like Blast Arena Advance is independent. A full commercial but unlicensed pressing or production run of a homebrew game like the Feet of Fury is independent. A full commercial but unlicensed pressing or production run of a game by professional developers like Radium is independent. Even a full commercial, *LICENSED* and distributed pressing or production run of a game like Trigger Heart Excelica is independent.
The term is imprecise. That doesn't mean it's not a good term, but it means that sometimes you might need to be more specific and in some cases homebrew is the equally correct term needed for better precision.
As you pointed out the lines between homebrew and independent and professional and major releases are being increasingly blurred in the current video game market, not only by GOAT Publishing, but also by things like Xbox Live Arcade, Internet distribution and the more and more advanced unofficial dev libraries. Today's announcement about Cool Herders on the DS which is being developed with the official devkit and I assume will be fully licensed and distributed (though perhaps not widely), is a perfect example. In many ways, this is like partial return to the video game market of 15 or more years ago and I welcome it (though of course there's huge differences between what we're seeing today and the way independents worked in the late '80s).
One of the reasons you've given for not liking to use the term homebrew is that as you say, it implies that anyone could produce these games. Well, that's exactly one of the primary reasons why I *LIKE* the term. Anyone *CAN* make these games and that's a fact I love. It's a fact that will hopefully spell big changes not just for the video games industry, but for video games, period.
I'm not angry about this topic, by the way; just defensive.
...word is bondage...