Microsoft's best business decision was that they designed the XBox and XBox 360 to have a similar development environments to the PC which ensured a lot of support from PC developers. Their worst business would be purchasing Rare, they were (fairly) expensive and have produced so few games that the purchase will never be justified.
Sony's best business decision was taking the Playstation (which they were developing with Nintendo) and launching it against the over-priced Sega Saturn. Sony's worst business decision was launching the PS3 at over $300.
Nintendo's best business decision was to go against the flow of the market and target the broader non-gamer and "casual" gamer market while everyone else was focused on the core gamer. Their worst business decision was the producing the Virtual Boy at a time when the technology was to immature to actually do it well.
Edit: I misread the initial post.
