Nintendo is over engineering and over thinking their hardware.
They should've just used an AMD E6760, it would've saved them a lot in R&D costs and given them higher performance for probably an equivalent cost (maybe even cheaper) since it wouldn't be such a custom part (500+ GLFOPS easy). Third parties would like it better because it'd be easier to move PC games to the platform, and lets face it, Nintendo's own teams do fine on any hardware. And an E6760 only draws 35 watts and that's with GDDR5 memory, axe that and it would be even lower.
You could customize it a bit I'm sure too.
Insisting on such proprietary, customized hardware is killing Nintendo on cost, and they're not even getting great performance bang for their buck. For $350+ IMO, even with a 6 inch low-res LCD screen on the controller, they could've gotten a better piece of hardware from AMD.
I think this is where Yamauchi and Iwata are different, Yamauchi would opt to go with more standardized components if it meant cheaper cost/better performance.
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