@Colors due to hardware. (your idea Rol)
Well let's talk about it. Here is the artwork for Super Mario Bros., which was independent of HW as can be seen by the liberty in the body proportions of the drawn characters.
For some reason, the color scheme was the same between the sprites and the drawn characters. I'd be hard-pressed to find that the explanation for that is due to HW limitations.
A few others as food for thought
(Ignore Yoshi's Island there, not important to the discussion)
Even in the post I gave with the pics, one of those was from Galaxy (the 3D fireball mario one). As sparkly as Galaxy was in certain areas, it was never flashy, and at other times it compensated with more traditional moves, colors and power-ups. The same can probably be said here, but certain things in general would make that compensation much harder I think.
