Iwata is good for Japan but he really doesn't understand the Western market.
They're so quick to lock up Dragon Quest and Monster Hunter (Japanese centric IP) but where is the Wii U's Western partnerships?
And even in Japan, the Wii U has been a tremendous disappointment.
Handheld market is simply friendly waters for Nintendo. It's more kid-centric and even the adults who do play handhelds are less interested in realistic graphics when playing on a small screen. Even on cell phones, it seems people prefer cartoony games like Angry Birds and Candy Crush and Plants Vs. Zombies over games with realistic graphics.
And people don't really need as many handheld games nor as they as picky about third party support or a lack of genre support (ie: not many FPS or car sims or sports games on 3DS, but it doesn't matter). Handhelds don't sell as many games. But that plays to Nintendo as well because Nintendo doesn't get burned as badly with handhelds if they need to go a period of time without a major release.
Handheld games are generally quicker and cheaper to make as well.







