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As many have remarked, making a game with no interaction is like making a film with no images - it might sound great, but there's no reason to be using that medium.
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On the other hand, just because you’re using a particular medium, doesn’t mean you’re obligated to utilize every aspect of it.
There are plenty of games which include a storyline completely incidental to the gameplay itself – one cannot alter the course of events through their interaction. Those stories could probably be told just as effectively in a movie, but the games are still just fine to play.
Dear Esther doesn’t make any meaningful use of interactivity. Does that make it a bad experience? No.