I think Wii/PS3 are going to follow a pattern like DS/PSP last year, with PS3 winning a lot of the year by time... But with Wii Sports Resort and Monster Hunter 3, I think Wii will win the year by a small margin in Japan.
That's not exactly a good situation for Nintendo.
I'm guessing that Dragon Quest 10 is a 2011 or even 2012 title. They don't come out very often, and usually very late in a console's life. The plan with DQ games since PS1 has been to wait for a huge (20m) install base and then capitalize on it; they don't care about helping to push hardware sales.
I think folks are right that the lack of the Wii Sports bundle could be hurting them. Nothing sells a great game like playing it, and Wii Sports basically invites people to play it like no other. But even games people were once interested in, but never played, become old news when there isn't something pushing it back out there, or giving them an opportunity to try it.
I think the rise of the PSP is hurting them too, and that it's foolish to think that handhelds and home systems don't compete, especially in Japan. If not consumers, PSP certainly competes for developers. And IIRC, Wii has by far the least software titles in Japan of the three regions.
"[Our former customers] are unable to find software which they WANT to play."
"The way to solve this problem lies in how to communicate what kind of games [they CAN play]."
Satoru Iwata, Nintendo President. Only slightly paraphrased.
