It really was no surprise. The cheaper alternative to the 3DS, the 2DS released the same time as Pokemon X/Y for a reason, and with the upcoming release of Sword/Shield, this was a no-brainer.

Also, Nintendo/Nvidia can utilise Tegra processors off the manufacturing line that have slight defects, where the GPU cannot run in full 1080p TV mode, but can happily handle 720p handheld mode.

From the standpoint of a Switch owner, the move doesn't make sense, but from a business perspective, it makes all the sense in the world.