I think, the thing is, Piracy on consoles for the most part is commited by people who are either A) Very tech savvy, B) Very poor. Nintendo is aiming to curb piracy on the Wii with all sorts of different measures. I read somewhere there are already a few different versions of the Wii already released, which means to mod it, you need something different for each version. Could be wrong though.
The fact that piracy is rampant in 3rd world/2nd world countries just reflects that MOST software is made in 1st world countries, usually by the richer countries still. Why would Microsoft bother boxing up windows (for instance) and selling it in China if they could honestly only get $10 for it? Nintendo is actively trying to sell software to China and actually make money, but obviously it is very hard to do.
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