3.3 Million isn't that bad (it is similar to the number of PS3 games that have been sold worldwide) ...
I could be wrong, but I suspect that the pricing of the games has very little to do with the actual costs associated with the games and is more about producing a "value" for these games in order to encourage developers to develop games for the Virtual Console.
Hypothetically speaking, Nintendo (and the virtual-console company) could be taking a 20% cut off of the top of every game sold as a distribution/licencing fee. Now if you're a publisher you may look at the Virtual N64 and see a platform where you can develop a game for $500,000 to $1,000,000 and make $8 per title which means you only have to sell 62,500 to 125,000 copies of the game to break even; not a bad target for a downloadable game. On the other hand if each game was only $5 it would mean that they would need 125,000 to 250,000 to break even which seems like a much larger risk.
