It'd be very interesting to see what would happen if High Voltage Software licensed their Quantum3 engine. Definitely the most impressive engine I've seen on the Wii som far and their Conduit 2 proof-of-concept demo is running at 30fps with shader effects without optimisation. And as other people have mentioned, if Capcom can run a version of the MT Framework on the 3DS with very impressive results from what we've seen so far I can't see why Epic can't do the same thing for the Unreal Engine. Either lazyness or lack of ability imo.

I'm really surprised that in all of the interviews by industry journalists with High Voltage Software that none of them have asked about the possibility of them licensing the engine. It'd be a (pardon the unintended pun lol) licence to print money.

It seems more and more likely that the guys at Epic just do not like Nintendo, and personally I think that's ok.  Companies are composed of people and sometimes the people at the top will have their console biases due to their personal experiences with one console or another.  It's similar to how if someone says "they should port TLS to PS3" one of the responses you hear is "Sakaguchi hates Sony so that would never happen".  Sakaguchi hating Sony is fine and noone calls him a dousche for it as far as I can remember so I think Epic can do the same with Nintendo.

As far as the actual statement, it's probably less that running UE3 on 3DS is impossible, and more that it is more work than it is worth in the minds of Epic.  Development on Nintendo hardware is not really heavily middleware dependent to the best of my knowledge and they probably just think that after finally getting it working, not enough companies would use it to make it worth their time.  True or not, I think that's the logic they're going with.

It's his BS justifications, and even trash talking (once he had to retract a statement while complaining that he had to do so), that are the problem, not his bias alone.

He doesn't have to always use the latest engine exclusively, y'know.

I've read a few interviews and even asked them myself in an interview if they'd license out their engine but it seems at the moment they don't have that planned but aren't ruling out later on.  My guess is that they asimply aren't set up to operate as a middleware provider yet but likely will as the next generation of consoles comes along and they develop their next itertaion of the Quantum3 (or perhaps Quantum4) engine with that in mind.