Why are in-flight entertainment systems not very evolved?
It's expensive. If you wanted to build something like an XBox or Playstation into each seat,  you're talking about an absolute minimum of \$300 per seat (\$60,000 for a small-ish aircraft like a 737, \$160,000 for a typical A380, and probably much more). While that doesn't sound like a lot on the price of an airliner, it certainly adds up over a fleet of hundreds of aircraft... all of which means you have to add to the ticket price and become less competitive. And that's just talking about gaming.
Safety/security. Allowing the passengers to connect to the system, no matter how well designed, is a potential security hole. This can be avoided to some extent if you completely separate the systems, but there's always potential for someone to find a loophole you didn't think of (overloading the in-flight entertainment and messing up the electrical power, for example). Dealing with this would add significantly to the cost above.
There isn't much need to. Most people who fly are either happy with the in-flight movie choices, or bring their own iPad/Kindle etc.
While using Airplay to send movies from your iPad to your TV works pretty well for one or two devices at home... it quickly falls apart when you're trying to make a wireless network capable of handling 200-800 streams at once!
General safety concerns: despite the fact that we're now fairly confident that having electrical devices on with their WiFi/Bluetooth/4G off is safe, to send the movies they'd need to turn WiFi or similar on, which is a potential risk


In short it's a lot of risk and cost, for not much reward. If you have an iPad with you, why do you need to send the movie to the TV screen in front of you? You can just watch it on the iPad.

Note also that some airlines do have some basic multiplayer gaming built into the IFE: although it's more "Connect 4" than "Battlefield 4"