Personally, I thought discounting the DS was foolish based on price and Nintendo's history was a foolish move by most analysts; they choose the PSP because it was more powerful, targeted an "older" audience, and included a movie format which was assured to be all the rage.
After TGS 2005 I was positive that Nintendo found a way to regain a large portion of total market because everyone would want to try it, it could be used to create new and unique gameplay experiences, would become the staple of the social gamers diet, and (if inexpensive enough) everyone would buy one.
After E3 2006 it became clear that Sony had lost all chance of regaining the dominant position. The general public choose the Playstation and PS2 because they were the systems which "Had the most games" and "Had all the great games" when the PS3 was announced to cost $500/$600 I realized that this would all change; it would take a long time for the system to hit a mass market price point which means sales would be sluggish and third parties would abandon the system long before consumers would see the price as reasonable.
Honestly the only people who still see it as possible that the PS3 will become dominant choose the PSP to destroy the Nintendo DS and thought that the Wii was going to sell worse than the Gamecube ... These people do not understand the game industry and if they are paid analysts they should be fired.
