I explained this in another thread, but Nintendo has always viewed itself as a creator of entertainment toys, not as a manufacturer of videogames.
It started in the 1890's with trading cards...then moved onto electronic gadgets in the 1970's. When the original Nintendo ENTERTAINMENT system came out, Nintendo focused on released fun platforming games like Mario Bros. because that's what they thought people viewed as a "fun toy"....sitting in front of a television screen with a nifty new electronic gadget.
Of course, nobody knew that video game consoles would explode into the huge business that they are now. Had the NES failed, I am certain Nintendo Company would have just moved onto a new type of toy/entertainment product to sell, like it always had in the past as its audience lost interest in old toys.
Now Nintendo is known solely as the video game megalogiant, for good reason. The Wii fits into Nintendo's century-old philosophy of entertainment manufacturement. It's innovative, sleek, on the cutting edge of technology, and most importantly ENTERTAINING to a broad audience.
However, that leads to the question: does Nintendo owe anything to its users whom have grown to love the company as a video game company over fifteen years? Of course. Regardless that Nintendo is releasing buttloads of fun games on the Virtual Console and on discs that appeal to loads of people, I do think they are ignoring hardcore gamers. Luckily we have third-parties whom will hopefully satisfy us in the coming years, as they have primarily in the past.
I think that the comment from k-boz stating that Nintendo has (in a way) "dumbed down" its classics like Mario and Zelda is spot on. The company just wants to release a fun toy. Which they have. But in doing so, they are sacrificing the margin of hardcore gamers.