The question of whether or not the Wii Fit is an exercise machine depends on your definition of exercise. Which I imagine can vary. (Marathon runners and their trainers may feel that body building with weights is good for you, but without the heartrate high enough, substained long enough, not exercise.)
But as far as I know, N. isn't saying it is an exercise machine. As far as I know, it's being treated more like Brain Age, where that game stimulates your memory... then lets others make the more fantastic claims for it. It's Wii *FIT*. As I understand, toning by stretching, yoga, balance, etc. As well as fun games.
But aren't all games like this in their way? That is, none really teach you how to be an expert fighter, general, race car driver, pro football coach, dog trainer, but all give you a bit of the feeling of that (well, the better games) and are fun. WiiFit won't make the majority of us thinner, completely healthy etc. but it will be close enough of that feeling to sell well, IMO.
Torturing the numbers. Hear them scream.
