So what I got out of that post is LucasArts got pissed because Nintendo didn't push online and Square got pissed because Nintendo was pro cartridges. Hmf. (the latter of which is silly considering how Capcom mananged to fit RE2((a 2 disc ps1 game)) onto an N64 cartridge)

Like, is there anything else specifically? 

You have to remember LucasArts published Star Wars: Rogue Squadron III on the GameCube. Their next game was Star Wars Battlefront on PS2/Xbox. I am willing to be that they wanted to release Battlefront on the GameCube as well.

Battlefront on GCN would have kept me from buying the PS2.  That's the only reason I got that system was for the Star Wars games.  And I've still never been able to get that damn PS2 to connect online.

This generation especially, Nintendo reached out quite a bit to 3rd parties... but they're basically all Japanese.  Nintendo really needs to step up it's game in western development circles and start offering the same sort of incentives, support and collaborations they do in the home market.

For JP stuff though, Nintendo does more directly with 3rd parties than MS and Sony combined, and they're the only 1st party who allows their own studios to develop games for 3rd parties directly. Just this gen, they've had a TON of tie ups and partnerships for games from 3rd party publishers... this also leaves out PAL region only publishing/distribution deals, of which there are a TON (Trauma Center series, Phoenix Wright series, Harvest Moon series, Naruto series, etc, etc), and there's probably some things I've forgotten...

AQ Interactive

• Nintendo studio (Brownie Brown) co-developed Blue Dragon Plus

Capcom

• co-published/promoted Monster Hunter 3/Tri in western markets 
• co-developed Classic Controller Pro (specifically for MH3)

I guess that problem is not Nintendo or Third Parties... the is Wii gamer that didn't buy Third Parties games.

So low sales... and lack of interest of Third Parties developer others games for Wii.

But DS (high Third Parties games sales) is another case... and Third Parties support it very good.

The problem started before the Wii was released, most third parties had treated the Wii as a dumping ground for second rate games (those that would've cost too much and not sold enough to justify releasing them on the HD consoles), or as a "casual" system for cheap and cheerful games, and everyone else just disregarded it.

Once the Wii came out and was a huge hit, third parties found they had missed the boat.  They had invested their biggest franchises to the HD consoles, luring their fans towards those systems, fans who would complain if third parties tried to shift towards the Wii; they had put cheap second rate games on the Wii, which alienated the Wii owners who focused on Nintendo, the only company that put AAA effort into the Wii.  Now, four years after the Wii's launch, third parties have simply shrugged their shoulders and now consider the Wii as unrecoverable, believing that a successor for the Wii will show up long before they could change direction and salvage the situation.

This is why you hear so much about a Wii 2 or WiiHD, the third parties want Nintendo to hurry up and release new hardware, which they see as a fresh start for their games on Nintendo consoles.  This is why the 3DS seems to be getting better support: it's a new Nintendo system, and third parties cannot afford to let it slip by, otherwise they'd be shut out and have to wait another 6-7 years for another handheld.

It's a catch 22.  3rd parties don't make attractive Wii games so consumers don't buy 3rd party Wii games so 3rd parties don't make attractive Wii games so etc.  With DS, 3rd parties actually brought AAA content rather quick (in Japan at least) with market builders like FF3 or Phoenix Wright and it turned out well.  On Wii they didn't, they waited until it was too late, then threw out a few worthwhile efforts, and it mostly didn't pan out.  Too little, too late, and it's hurt both Nintendo and 3rd parties really.  Hopefully everyone wakes up for next gen, 3DS is encouraging at least...

Its a combination of problems...and a vicious cycle

To start this generation very few developers (almost none) were betting that the Wii will become that succesful, so it took them by surprise and they were already developing their new franchises for the other machines. To try to get some money rom the system, they tried to produce some very poor quality games very fast to sell them to the new players, a lot of those were sold, but most of the buyers got burn by the lack of third party quality games, unlike the Nintendo products that were always top notch.

Now when there is a good third party game in development only the few minority of gamers that follow the gaming news actually buy them, and that's not enought to keep making big budget developments for the console, also the multiple console owners even if they are interested in a few Wii games, only have a limited budget and they usually use it to buy games in the other consoles, because they know the franchises or trust the effort of the developers for the other consoles.