This will probably strike many around here as a very foreign and impossible concept, but there are people who enjoy games like Wii Sports, Wii Fit, Wii Play, and yes, even Carnival Games. But they aren't interested in games like Halo 3, Gears of War, Metal Gear Solid 4, or even LittleBigPlanet. These people, whom I'm sure many here would be tempted to write off as "casual gamers" and be done with them, are as valid of customers as any of us are; our money is not worth any more to the industry at large than theirs is. They are downmarket gamers, often new to the market or just disinterested in moving upmarket at the moment.
And of course, there are the midmarket gamers who also enjoy the Wii series, but will still play some upmarket games as well. Most gamers actually fall into this category, and I'm sure they vex the self-proclaimed hardcore even more since they can't rightly be labeled "casual" if they also enjoy games like Super Smash Bros Brawl and Resident Evil 4. They are the market's actual lifeblood, you see; the gamers who will buy pretty much anything as long as it entertains them.
The group that only buys upmarket games, of course, will happily identify itself as "hardcore". And if they want such a negative label, they're welcome to it (try looking up "hardcore" some time; it basically means somebody who's dead set in their ways and opposed to change, like the cliche'd old man who complains about "them damned kids"). But I'm sure this market is well known; they're the sorts who scoff at the Wii series and think that the 360 and PS3 are superior platforms based on the games they like. And for their own tastes, they're absolutely right. The Wii is not particularly littered with upmarket games, after all.
Well, there you have it in a nutshell. The Wii sells the most because it appeals to the downmarket and midmarket consumer. In other words, to people who will play only simple games and to people who will play just about anything.