I lack the information to properly assess whether now was the time to cut the number of Pokémon, but 3D is almost certainly the culprit here. Even models themselves are probably a lot of work, but I doubt they're a real issue on their own just yet. Instead, I imagine animations are the main problem. Moving forward, it might be possible to add back the missing Pokémon and keep re-using the assets and animations, but handheld-quality models and especially animations were probably deemed insufficient for a TV-size experience. Once the models and animations have been done in HD quality, it might be possible to keep re-using existing work. For now though, this is what we're getting.
Moving on to the actual question, this will probably still be successful commercially. From that point of view, the jump to 3D wasn't a bad thing. It seems to have worked on 3DS, and in the case of Switch, people would probably have already expected 3D anyway. I don't see sticking with 2D as a viable choice for the new game. Well, it might have been, but it would have taken quite a different art style, one that would probably have been chosen a fairly long time ago. Judging by a quick look, even White 2 had a style whose natural successor was 3D, so here we are.
Personally, I don't mind 2D, but it takes some pretty good design to be able to make it work in a game like Pokémon in HD resolutions while still keeping the games interesting to play.
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