Points 1 and 2 are valid, and point 3 is all a matter of taste (although history helps to demonstrate that you're largely incorrect). The industry certainly kept growing even when Nintendo was doing poorly (though i still contend we'll reach a plateau this generation).
The key to Nintendo's importance in the industry isn't that they are the *only* one innovating, certainly not. Innovation happens all the time and there are few publishers (outside the shovelware pushers) who can say that they've never upset the formula either in terms of game design in some genre, or business model, etc. The key is that nobody else pursues the kinds of games Nintendo pursues, or does so with such vigour. Sony commendably makes an effort in high-quality, retail-grade platformers, though cannot quite capture the mystique of Mario, DK, or Kirby. Ubisoft keeps Rayman around (though for how much longer after what Legends sold?). Nobody consistently puts their best foot forward in games that aren't violent or adult-oriented in some form (unless you're talking about sports or racing games), so Nintendo's loss would leave a large gap in the industry, similar to if Disney went belly-up tomorrow (and, for the sake of argument, Pixar went down in flames with them), there's nobody that can quite replace their imaginative brand of family entertainment or overall focus on quality in their specific field. Moviegoing, even family movies, would persist, but be noticeably diminished for quite some time.
To compare in terms of the "absence of Nintendo" factor, if Activision left the industry altogether, there would still be military shooters. If Capcom left, there would still be zombie action games and fighting games (though that would be a hard blow to the already-anemic genre) and ARPGs. If EA left, 2K would fill the sports gap. If 2K and Rockstar disappeared, you could still get open-world crime games.
Who replaces Mario? Who replaces Pokemon, Zelda, Metroid, or Kirby? This is where the difference lies.
The rebuttals to point 1 and point 2 (while acknowledging the validity of your arguments, to be sure) lay the grounds for rebuttal to point three. Nintendo's pursuit of basically neglected genres means that for people who like these game-types and are gaming largely amongst them alone (yo!), there's really no true alternative. I can and do enjoy non-Nintendo games of diverse types, but would I really enjoy *gaming*, as a whole, with Nintendo out of the picture?
Monster Hunter: pissing me off since 2010.
