Imagine the headlines about Nintendo Switch surpassing the sales of the almighty legend of gaming, ps2.

I consider that it could work as a free marketing to its successor. 

Japan is the place still making the Switch relevant, but once that's over, it's over.

It won't be enough to reach 160 million.,

Yeah, it's heavily dependent on Japan. 

The world isn't the same. Tariffs in the USA, Switch 2 is doing better than PS3, and so on.
Nintendo could've already outsold PS2 or close to it if around 2023-2024 they dropped prices to the SKUs by a lot. $199.99 for Switch, $99.99-$129.99 for Switch Lite, $229.99-$249.99 for Switch OLED. That would've probably been tough to get a profit on the hardware, hence why Nintendo didn't do it. They do love selling their software, but they like selling it at top prices and they have sold consoles at a profit the majority of the time.
Unless Nintendo manufactures Switch for a while or has a stockpile of them, I really don't see surpassing PS2 as the most likely scenario.
I know Switch only has about 7 million units left to hit that milestone, but that would be a crawl given the changing market conditions and the popularity of Switch 2 and PS5. Switch can probably sell several million in 2026, but I'm skeptical it will crack 1 million units or more in 2027. By its 10th year on the market, it will likely be near-death in hardware sales.

Ultimately, the title of "Best Selling Gaming Hardware of All Time" is arbitrary and only really matters to enthusiasts. That said, if Nintendo Switch does manage to beat PS2 LTD, then cool! If it does not, however, then okay. It's still number two, and coming off the Wii U/3DS years of Nintendo (back when their biggest hits were on iOS (Pokémon Go,. Super Mario Run, etc.) and niche collectibles (Amiibo, NES Classic, etc.)), there is no legitimate reason to be upset with this outcome.

Only way I see it happening is if the rising costs of RAM and other components + tariffs force Nintendo to raise the price of Switch 2 to the point where it’s too expensive to appeal to the casual market and thus it’s not able to reach that next rung/level of sales, so they keep Switch 1 around that much longer out of necessity. So that they can still have an entry level system that appeals to the newer casual market and younger parents looking for a system to buy for their kids and thus maintain their revenue and profit forecasts (to a degree) despite Switch 2’s momentum slowing down.

Basically a similar reason why the PS2 stuck around for so long because the PS3 got off to such a slow start due to its absurd price tag ($600 in 2006 - Yikes.)

Very silly view.  The average gamer has no idea what the top selling console is and doesn't care.  

Nintendo could have beat the PS2 with the DS if they really wanted to, it's not really that complicated, drop the price to $79.99 and let it sell for another 2-3 years and they easily would have the record already, the Switch similarly could do the same thing. Nintendo doesn't care that much about it. DS was way ahead of the PS2's sales curve, so is the Switch.

It's not an issue of popularity of anything, Nintendo's had the PS2 essentially beat twice, they just called off the dogs, well at least they did with the DS, maybe they will let the Switch 1 go for the kill this time. 

I agree, ps2 could have easily sold 200mill if sony just dropped the price ro 49.95 and kept selling it for a phew more years.

Switch had a massive advantage being the cheapest system + covid.

If Nintedo releases a cheaper NS1, maybe a new lite, and continues to produce that along side NS2 then sooner or later it will pass 160 mil