While having more stringent requirements might help things in the short run, LHWB, it would cause issues down the road. In fact, a great deal of the developers during the PS1/N64 era switching to Sony revolved around Sony's freer licensing requirements. The myth that it was the format which drove them away is only true in an abstract sense; the expense of printing on cartridges was greater than CDs, but developers will do that if their software is going to sell on that system (which is why the DS and Wii get away with proprietary formats). There is a fine line you have to walk, between laissez-faire and extreme control. No company has ever found that delicate balance point for long, largely because it shifts constantly.
A big problem is that most developers have spent well over a decade producing games which followed a model of "higher production values". That model's been tossed out the door in favor of a model of "higher gameplay values", which is a jarring shift for a company whose biggest-selling titles cost millions and come with increasingly more complex interfaces.
Nintendo isn't trying to beat third parties; they're trying to help them by showing them the new values system which surrounds their systems. Some developers (such as various Ubisoft studios) are catching on. Others (such as Electronic Arts) are not.
Sky Render - Sanity is for the weak.
