Nintendo could have avoided much trouble if they had just released them differently. FE Fates 1 now, than 6 month later FE Fates 2 and another 6 month later FE Fates 3. As a result the release shedule would look better.
Would also be better for the gamer. I needed a long time to fully complete Awakening (Getting all supports). I don't know if I will have the patience to fully complete Fates 1, if Fates 2 and 3 are already out and wait to be played too.

This reminds me of Suikoden 2's differing scenarios.

Wish the developers didn't do this, but well. I hope this doesn't lead to bad sales, because I can't picture a lot of people purchasing everything (will VGC track each version separatedly?).

Like Outlawaron said, Blazing Sword offered three different campaigns included in the same game. They didn't sell them separatedly on different versions.

o: But Lyn's was basically a tutorial with lasted 10 chapters until joining Eliwood, and Hector's is mostly the same campaign, but with Hector as the lead and a couple extra missions and 2 extra characters. That doesn't quite seem the same as Fates in terms of different campaigns.

*sigh* I don't have time to do that right now. I will say that I think anyone putting so much emphasis on the volume of content in strict terms like 'hours' or 'chapters' or freaking 'campaigns' (an extremely vague term which treats actual content volume as utterly arbitrary) is doing a disservice to media in general. You wouldn't complain that The Half-Blood Prince is a ripoff at full price because it's some 200 pages shorter than Order of the Phoenix. You wouldn't complain that the three Lord of the Rings films were all made at the same time and therefore should have been screened as a single 9-hour movie for $10, and that charging $10 for parts 2 and 3 was like charging $30 for one movie.

With Fire Emblem you get a staggering amount of content for $40 which puts most $60 games to shame. The quality of that content is very high -- early impressions suggest that Fates fixes most of Awakening's (admittedly few) flaws. This is a tighter and more balanced game than Awakening, with a lot more effort put into the story to boot.

Regarding "our new game will be bigger than the last one, so we will cut it in two games," that is not what anyone at IS said. What they said (as explained during the Iwata Asks) was:

I (the game's producer) thought, if we packaged them separately, people could have the fun of choosing which one they wanted, and wondering "Which should I get?" (...) A few days later, he (the director of both Awakening and Fates) came by, and said, "I completely agree that we should make two games, like do you ally with kingdom A or kingdom B, but I also think that you could choose not to ally with either. So I want to do three."

They decided from the start to make three games, and realized this would mean three games' worth of content. Not splitting up a single game into three. Personally I think it's telling that the third game is not being sold separately -- they probably don't see it as a full new game because it shares so much content (mainly characters) with the other two.

I don't know much about the third version because I'm trying to avoid spoilers. I don't know whether it has any unique characters of its own. The maps are certainly different though -- for reference, Awakening's main story was 27 chapters long, Fates' is 28. The first six chapters of Fates are shared between all three versions, but take my word for it, chapter 1 is a tutorial that literally takes under a minute to complete if you skip the tutorials & dialogue. This is why I don't think comparing raw numbers of things like chapters is helpful. But if you really want to do that, you're looking at 22/28 unique chapters in each version (actually I don't know for sure that the third game has 28, but the first two do), which is over 78% unique content. Consider also that the first six chapters, even aside from the first one, are fairly small and short compared to later chapters, as usual for the series.

Still, they could have taken Lyn's episode and put it on a FE:Prologue version and sell it separatedly. Kinda what Capcom did with the fifth episode of Ace Attorney on the GBA :P. But it lies within the whole game itself.

I don't know, it just seems weird to force me to choose a version and getting locked out of the other two unless I pay for them as well. Couldn't they go the Fear Effect route? You play it once, you pick one of the two characters halfway through and unlock his ending; you play it again, you pick the other one, you unlock her ending; then you play for the third time and the third final option of picking both characters is available to you, unlocking the third and true ending. This third path has all the warning signs to be the "true" option to pick (it also seems the hardest one since MC doesn't chose either side), but I don't feel compelled to purchase a game three times in a row.

And call me paranoid, but considering how abusive the DLC in Awakening was, I'm expecting something shady.

"Cloud Atlas had six different stories in it. They didn't sell the movie tickets separately as different films."

Sacred stones didn't need two versions for two campaigns...

Now imagine if the tie-in movie game had six different versions to pick.

Sorry, my imagination isn't strong enough to imagine a licensed game without Batman in it being anywhere near the quality or length or replayability of Fire Emblem.