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If the core were to move to $199 I think that it may receive a boost as it puts the price at a much more mainstream level. I do not believe, however, that Wii sales will collapse because of it. In fact, I do not believe that Wii sales will be significantly affected, (if at all) by the Sony price cut, or a potential MS cut. There is a significant Wii title coming out for both July and August (Mario Striker and Metroid Prime 3), that should keep Wii's momenton going until autumn at least.

Edit1: Added some words to make the post more clear

Edit2: At $199 I would actually strongly consider picking up an X360 to go with my Wii.