I have never seen Nintendo so out of touch.

[ZaP~]

Isn't Pokemon, one of the biggest brands in the business is a JRPG and sells in the range of millions.
I don't think being niche is an insult, but saying JRPG that aren't called FF or DQ will sell awful is a lie.

Tales of Symphonia also sold quite different than awful (at the bare minimun much more than a million)

I could resume as I don't think the genre is niche, but it's true it has a lot less appeal for a US gamer than a FPS or an action adventure game.