Second, yes Nintendo's N64 and GCN were not top sellers. The N64 would have done better if it was CD instead of Cartridge, and if Nintendo did a better job managing relations with third parties -- something they still have trouble with to this day. However, the Wii has sold 70 million units. If you combine how much PS3 and Xbox 360 has sold, the Wii is only 30 million behind. And considering the Wii is just GCN hardware, you could even add what GCN sold to that and it would be 91 million -- even closer to the numbers of PS3/Xbox 360. And look at the legendary success of Nintendo Gameboy and the DS, and it shows that Nintendo can and will continue to do well in the hardware market.
Third, Nintendo consoles typically are hard for third party developer to sell on. Why? Because Nintendo is such a strong competitor. Where Microsoft and Sony both have strong first party titles as well, Nintendo can pump out amazing games like it's nothing. If they went third party, I'd imagine developers would have a hard time when Nintendo releases a Zelda on PS3/Xbox 360. Releasing a new Mario this year? Better release your title after it comes out, not at the same time. Think I am crazy? Think this is absolutely a fantasy? I'd agree, actually. (Although Zelda would do well on another console) Mario, Kirby, and Donkey Kong would all do poorly on another console because those gamers want blood. Look at the declining sales of games like Sonic and other non violent games. Even Final Fantasy is loosing some popularity, although I am not sure on how much it is loosing in sales. Games that typically do well are Halo, Gears of War, God of War, and other violent video games that spill's loads of blood. How many times have you seen Donkey Kong rip a man's head off? Or Mario burn a human skin off and see blood gushing from the bad guy? Never, and you never will.
My final point has all ready been made, but without Nintendo we would have a different gaming experience. Without Nintendo would we have joysticks on controllers? (Look at the Original PS1 controller here and look at it after N64 here). Thats right, Nintendo put a joystick on it's controller first. Thats not the only first for Nintendo. Look at that original PS1 controller -- looks like a SNES controller with handles? Thats because it is. Originally, the PS1 was suppose to play SNES games with CD but Nintendo backstabbed Sony and thus, the Play Station became PlayStation and they kept the same controller (with extra shoulder buttons I am assuming). Sony further copied Nintendo's innovation, by adding rumble on the "Dual Shock" PS1 controller. Is that a bad thing for Sony? Heck no, but they didn't come up with the idea, Nintendo did. And need I point my finger at the Wii? Without it, would we have Kinnect? Dual Shock 3 with it's motion controls? Who knows if we would, because Nintendo innovated and everyone else followed. Not to say Microsoft doesn't innovate -- but generally not with hardware.
And next week we'll see new innovation that I am sure more will follow, because they have no choice. Without Nintendo making hardware, we would be in a world of hurt and Nintendo would not do well against the other developers.