If we're gonna play the "Coulda, woulda, shoulda" game, what Nintendo really should have done initially to normalize the supply-demand curve was to sell the machine at $299 USD rather than $249. Would have probably still sold out, and Nintendo would be sitting on an even huger pile of money right now. Believe me, if there's any lesson they're taking from this as they plan the launch of Wii 2 in 5 or so years, it's that.
As far as increasing production, I'm sure they did what they felt they could. The attitude of the OP is that Nintendo hates money and has stubbornly resisted increasing production because, once again, they hate money. Which couldn't be further from the truth. On both the increasing production thing AND the hating money thing.
So say we all, yo.
