I am a bit biased, having worked on two Nintendo U64 games (mostly game AI). That said, Nintendo seems to be doing everything right:

• Concentrate on game play: Shigeru Miyamoto (who was at Angel Studios the first morning that I started there – many years ago) felt that the key to better game play was a new controller metaphor, not expensive graphics hardware. Start with a concept (game play/controller vs. graphics hardware) and carry that through from development to launch
• Profitable console! Compare to > $200 loss on selling PS3 console.
• Launch with sufficient units: satisfied Nintendo customers vs. many disappointed Sony customers

Well done Nintendo. While I sometimes enjoy gaming on my Sony Portable Playstation, I was disappointed by the very high cost of movies in the UMD format. While I am tempted to buy a Wii (my stepson, son in law, and grandson will all be visiting for Christmas, and a new gaming machine would be fun for us!), I am not inclined at all to buy a PS3.