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Yes, that's partially true. If you compare the innovation between Mario 64 and 3D World, it's night and day. But the biggest reason is demand. I really think Nintendo games are becoming niche now. When I was 7, in the mid 80's, Super Mario Bros. was the "IT" thing. Every boy in the country was either playing it, or wanted to play it. Is Mario that IP anymore? I don't think it is. I think Minecraft and COD are closer to that than Mario.

If Nintendo wants to come back, they're going to have to release something like a PS4 and rely on 3rd party support to push their systems. I don't think their IP can carry their home consoles anymore unless they can come out with something as mind blowing as OOT again.