Yeah the lacking software and price is really hurting the 3DS right now.
There are also people like me who can't see stereoscopic 3D very well and this is a pretty significantly large minority to boot (my eye doc confirmed to me in an eye test 2 years ago that I can't see the "popping" 3D effect very well. I had no f'n clue I had this problem until I took the test. This isn't an issue that effects my day-to-day living at all so it went undiagnosed for most of my life. I went to see Avatar and Megamind and wondered what the big f'n deal was. The 3D effect was pretty underwhelming for me). And then there are many more people who get headaches from playing in 3D. Basically humans tend to have a lot of eye problems and by ignoring this fact, Nintendo is alienating a huge chunk of the human population. Heck Nintendo is even flat-out saying that no one under 7 should be using the 3DS. Right on the game box. Which will accomplish nothing more than freaking parents out (but I understand why they did it. Nintendo doesn't want to open themselves up to getting sued. lol). Which for sure is going to freak out a lot of parents. The hype surrounding 3D movies is also dying down. In part for the above reasons (but also because people are tired of the 3D gimmick being shoved down their throats and all the shitty 3D movies that released last year).
Yes you can turn the 3D off. But then who wants to pay $250 for the 3D tech when you are forced to turn the 3D off? And the profit margins on that thing are apparently pretty big right?
I don't know why Nintendo had to take such a big risk with 3D though. There are way too many obstacles that Nintendo has to deal with. I understand why Nintendo feels the need to "be different". They fear Apple and Google. They know that touch-screen gaming is no longer innovative, it's basically an industry standard now. You can make touchscreen games on iOS and Android devices as well as the NGP. But you know what? When the NES came around and the game industry laughed at it because they felt that home computers made dedicated game consoles irrelevant, Nintendo showed them whose boss and they didn't rely on a gimmick to do it.
Nintendo should have conducted business as usual and released a DS2 for $180 with the DS standard $30 games. It would have been way more successful without all the obstacles of the alienating 3DS. Games sell hardware. Not gimmicks. The Wii sold because the games were fun (to the mass market). Not because of the motion control gimmick. Smart devices are basically portable computers. If home game consoles can survive despite the existence of home computers without having to resort to a gimmick, portable gaming handhelds can survive despite the existence of smart devices without resorting to gimmicks. Besides aren't they coming out with Android smartphones that can do glass-less stereoscopic 3D? So much for trying to differentiate oneself from your competitors by utilizing 3D hardware. The best way to differentiate yourself from the smart devices is to create killer apps you won't find on those smart devices (and the NGP). That's how NES differentiated itself from the home computers. It's all about the games.