Alan

The spelling of a word is defined by the frequency of usage of those spellings. Since both appear often, one can say "video games" is just a word with alternate spellings, this difference of course being the space.

The story is not true. This was part of an internet prank where people went around in a car showing off to people in line and then accidentally dropping it under the wheel and having it crushed. He must've mis-thrown it in this particular instance.