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I think what most people miss is that even if they didn't screw things up, things wouldn't be that much better.

It's possible they could've dropped BluRay, built a 360-like machine and pushed all their devs onto the PS3 early (direct GoW2 to the PS3, for example). No matter what they did, the Wii would still trounce them and the 360 still starts with a 5mil+ lead selling tons of software (GeoW vs PS3). Sure, if they did everything perfectly, things would have played out a little better, but the same could be said about 360 and RRoD.