Some quick thoughts.
The PS3 has had an ultra-strong lineup this year while the Wii has had the same lineup. And the PS3 only outsells the Wii marginally most weeks of this streak.
Nintendo most grievous error was having too long between major releases. Why it did this, I do not know, but there was a similar point in the life cycle of the DS which was by design to permit third party developers a time to shine. The difference was that the market was split roughly 50-50 rather than 67-33 (like the handheld market), so third-party support did not increase as much as some might have expected.
People point to last year's E3. But Nintendo played to the general press which viewed the presentation differently than the gaming press. It should be noted that the two first party games there are considered failures by some, even though both Animal Crossing (3.00M) and Wii Music (2.55M) have outsold all but eight PS3 titles and 13 Xbox 360 titles (including those bundled). These "failed" games from E3 have more sales than Left 4 Dead (Xbox 360) or Little Big Planet (PS3)
So far, the game that has had the most trouble selling from E3 is GTA:CW for the DS (only 440k so far). Interestingly, it was the only M-rated game touted by Nintendo during the presentation, which makes you wonder if those "mature" offerings are always the best idea for Nintendo hardware. (Note that I put "mature" in quotes because M-rated to me does not automatically mean mature but rather it means graphic content which can be very immature).
As for the global recession, while the US is looking for (hoping for) a quick recovery, there are those here and most in Europe who are pointing to 2010 or 2011 before real improvement is seen. Unemployment in the US is over 8% and over 10% in EU.
Finally, remember that Nintendo makes profits while Sony and Microsoft have had their share of red ink. And Nintendo has many weeks outsold Sony and Microsoft combined. So if the industry leader that sells half the units and makes money is in trouble, what does it say about the other members of the industry.
Mike from Morgantown
EDITTED to point out that I was speaking of the Xbox 360 version of Left 4 Dead.