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Gamecube was in the same league power-wise and had greater, albeit lacking, 3rd party support. Not a lot of people want to pay that much for last gen hardware.

Hardware is also a major reason it has no 3rd party game support and the Nintendo image of being more for kids. But news flash, kids' favourite games (at least boys) are probably sports game, if my nephews and my friends kids and nephews are anything to go by. Kids also want to play on what adults play on and sport games are typically the only games that aren't violent on Sony and MS consoles.  Plus kids will have more fun talking to stranger online (with adult supervision of course) than playing the actual game.