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My personal feeling is in hindsight this is what Nintendo would do now.

"Wii HD" (2010/2011) is released, basically the same as the original Wii but now with some HD capability (720p for newer games like Skyward Sword/DKCR/Just Dance/etc.) and revised system OS and a completely new eShop that makes the Wii back catalog available for download. HD Netflix, Hulu, Amazon Video, Youtube Channel, etc. Budget console $149.99 to start, eventually $99.99. This would let the Wii sell for a few more years to the low end of the market and compete with things like Apple TV, Roku (the same idea Sony is trying with Vita TV). 

"Wii U" (released fall 2012) would be a different console perhaps an entirely different name/brand. The tablet wouldn't be standard, it'd be an option pre-bundled with Nintendo Land for $99.99 (ala Wii Fit). The chipset would be more powerful, the console as a whole would be designed more for American/European tastes. There would be some kind of new controller innovation but it would be a cost effective and cheap addition.