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The problem with Sony & MS releasing a 'wii-mote' controller is that Nintendo is not standing still. WiiFit will be out long before that and altering the market further. So then does Sony & MS also come out with a balance board? Their own brain-age, Nintendogs, etc. While always two steps behind Nintendo?

It won't work. People won't buy into it because MS & Sony are aimed squarely at the core gamer, and trying to imitate Nintendo will come across like that annoying guy who always has to tell a story to match and surpass what anybody else has done. You're not sure if he's telling the truth or not (probably not) but he sure doesn't feel genuine.