> "2.....Other companies aren't exactly thriving either. eg. Microsoft continues to eat into their profits with the whole RROD issue, and they're share price is falling down too!"
Failure + Failure =/= Success. Microsoft and Sony could BOTH exit the game market at the end of this generation. I don't think that's likely, but it's certainly possible.
As for falling share prices, that's happening across the board. The real question is who has a business strategy that will survive or even thrive in this recession? The answer is Nintendo, which is setting sales records AND making a profit on every piece of hardware sold.