Well this is what happens when your console aims for the larger chunk of the population that doesn't really play games instead of the people who you aimed at for all those formative years, they move away, play different games and on different consoles and generally ignore your console because they want some decent quality graphics that weren't considered old when the console came out, a proper controller that doesn't want to be something between a nun-chuck and a wand while failing at both (pre-motion plus) and games that aren't sports or shit.
Now, I think its great that they want to rejoin the, for lack of a better term, proper games market but I do think that, for better or worse, nintendo live in their own little bubble where they ignore anything the western markets say and chalk it up to "Well, the western market aren't interested in Japanese games anymore".
One of the biggest issues with trying to get back in on this market is that they will need to have an online service with full party/speech support but i do fear that if they dont step out of their bubble that they will fail at it, chalk another one up for "Westerners hate Japan" and go back to presenting 80 yr olds with their wiimote.