Likely. They're clearly making an effort to synthesize the two sides.

One team, one set of development resources to cover what two teams and two games used to cover

Though it will likely end up worse overall, since Galaxy plus NSMBWii is a solid 30 million, and i don't think Super Mario 3D would be able to match that, even if it itself matches NSMB sales levels

I'm not saying its a smart idea or one that i agree with, just trying to rattle off potential reasons.

I've been recently thinking the same thing too. I'm also predicting the game to a degree (a degree which I can't predict without more info) alienate advocates of 2d and 3d Mario platformers. Nintendo is being quite risky IMO. However, I've doubted them far more in the past.

Well honestly, would you expect them to make a 2D game for the 3DS? And yet at the same time they wouldn't want their handheld division to totally ignore that opportunity. So it would make sense that they decided to make a hybrid to incorporate 3D gaming while not abandoning Mario's roots.

I would not expect Nintendo to fail where Mario is concerned.

On the other hand, it would have been kind of funny to see Mario swap to having 2D on the console and 3D on the handheld. You could even say SNMBWii presaged it, with Galaxy 2 as the last gasp. But I don't think that's what's happening.

Well, they have an excuse not to release a sequel to NSMB - why bother when the game still selling strong every holiday season? It's not like your regular Mass Effect or smth, which are usually done in a few months.

My thoughts as well after seeing first gameplay footage :'(

Because they want to try something new and they hate money.

Anyone remember the old game Sonic 3D Blast?

http://www.youtube.com/watch?v=iTssGRcyWio

In the mid-90s, when the PlayStation was starting to have some hit 3D games, and the N64 was gearing up to launch and really push 3D at the expense of 2D, all the old 2D platform mascot games were trying to make the transition to the new, 3D world. When Super Mario 64 was shown off, it is said that many of those companies cancelled those games, and gave up. They were so far off base. And most of the 3D mascot platformers that did come out were exposed as being pretty terrible in the face of Super Mario 64. One of the most prominent was Sonic 3D Blast.

Looking at Sonic 3D Blast, what do we see:

-Dorky visuals.
-Stationary camera looking down on the action.
-Power-ups and extra life system straight out of 2D Sonic.
-Elements of 2D Sonic that are bizarrely out of place and meaningless in 3D, like loop-de-loops.
-Levels broken into displaced segments. Complete objectives to move from one to the next.
-Levels are linear, with beginnings and ends. No exploration.
-"3D" right in the title of the game as a selling point.

Looking at Super Mario 64, what do we see:

-Cutting edge graphics (it was 1996, trust me on this one).
-Rotating, user-controlled camera.
-All-new power-up and extra life system made for the new gameplay.
-Elements of 2D Mario that would be meaningless in 3D, like Hammer Bros., or stairs leading up to a flagpole, are just gone.
-Levels are open little arenas.
-Stars are not located at the "ends" of worlds. Exploration is a focus of the gameplay.
-Called Super Mario 64. It's just Super Mario for the N64

And looking at the progression from Super Mario 64 to Super Mario 3D Land, what do we see Miyamoto opting for with the newest game:

-Dorky visuals.
-Stationary camera looking down on the action.
-Power-ups and extra life system straight out of 2D Mario.
-Elements of 2D Mario that are bizarrely out of place and meaningless in 3D, like Hammer Bros. or stairs leading up to a flagpole.
-Levels broken into displaced segments. Complete objectives to move from one to the next.
-Levels are linear, with beginnings and ends. No exploration.
-"3D" right in the title of the game as a selling point.

Basically, in 1996, Miyamoto was smart enough not to simply imitate 2D Mario when making a 3D Mario. He made a totally new type of game. And it turned out this new type of game was beloved by some, but was not remotely as popular as the old 2D game. In his obsession to make this new game as popular as the old one, he has devolved 3D Mario into the same type of bizarro crappy 3D game that was exposed as terrible when Super Mario 64 was revealed.

As far as making a sequel for the DS, sales show maybe Nintendo thought there wasn't much of a reason. The game is still selling at pretty much the same pace as it was 2-3 years ago. I guess Nintendo did the math and made the decision that not diluting the market or cannibalizing sales was more important for them then selling another 10+ mil. copies (minimum) and potentially lowering the brand equity. Doesn't make a whole lot of sense to me because NSMB level sales are nothing to scoff at, and if you think about games like Brain Training that were really milked on the DS it makes even less sense...

Maybe Nintendo team-leaders are simply growing too old and disconnected from reality. Miyamoto will be at the age of retirement in Japan next year (not that he will of course, which gives me cause for concern...), although it should be noted that retirement in Japan is slightly different than in the west as it usually means moving on to a part-time position and not quitting altogether.

Frankly, I am really eager to hear about Nintendo's new generation of designers, and learn about their respective visions for gaming.

As for sales of the new 3DS Mario, it really doesn't give the impression of being that much of a heavy hitter so far. Nintendo have been speaking about the importance of stereoscopic 3D in platformers for quite a while now, and how it makes 3D games easier to play. I don't know if this kind of thing is really a selling point, and if it is how do you convey it?
Most of the people who love 2D Mario don't want to play 3D Mario, even if it is going to be easier for them now... You don't need the 3DS to prove this, it's not difficult to make a Mario 64 style game with more forgiving collisions, bigger platforms and weaker enemies etc. and I don't think that would reach 2D Mario levels of success, not even close.

Honestly instead of trying to combine 2D Mario with less popular forms of gameplay, Nintendo should just spin-off 2D Mario into its own company, like they did with Pokemon.