That doesn't necessarily sound like a competitive shooter and considering other Aonuma statements in the past, there isn't much of a reason to believe that it would have been about competitive play. The reason why Miyamoto ordered a different Link's Crossbow Training than the one Aonuma wanted to make is that the game was supposed to be a pack-in title with the Zapper and some full fledged standalone title.

"I was thinking that maybe we could intensify the multiplayer mode" - That doesn't sound like adding a competitive aspect? Even if it was just a score-based one?

Either way, it demonstrates that Aonuma and his team are more than willing to think outside the box if given the opportunity. I don't know where you read that Aonuma doesn't like reflex-based games, but it actually doesn't matter because this at least shows that even if he doesn't like those games, he has no reservations about creating a game that he himself would not enjoy playing - which is far more than I can say for Miyamoto.

And the conflict during LCT's development wasn't just between Miyamoto and Aonuma but between Miyamoto and the entire development staff! Miyamoto even suggested the game's story revolve around Link travelling to the future where it would make sense for him to use a gun! This was quickly vetoed by the team, but many were starting to think the project should just die at this point. In other words, I wouldn't say the team was overly enthusiastic about the project during development, and therefor I don't think it's surprising that the end result was less than stellar.

But regardless, you are right that Miyamoto enjoys too much freedom himself. If somebody wants to make a game based on his creations and he doesn't like the idea, then it gets most probably canned. This wouldn't be as troublesome if Miyamoto actually made those decisions from a business point of view, but all too often it seems to be more about his ego than anything else. What the developers want to work on shouldn't matter in the end, because work isn't supposed to be fun. If they enjoy their job, great. But if not, then they should maybe look for another job and that goes for Miyamoto as well.

There are actually two points here. On the first, I agree Miyamoto has ridiculous amounts of freedom and usually doesn't make strictly business oriented decisions and that this is bad for the company. However the reason I think he should be held back is related to the second point, on which I disagree on principle: Creative work should be fun, whenever possible! I can guarantee you that a team which is enthusiastic about their current project will deliver a better product than one which isn't, and also quite likely do it in less time and money. This is the main reason I object to Miyamoto's dictatorship inside Nintendo, and also why I bothered to bring up LCT in the first place - as an example of how much trouble one man can cause for what is ultimately not a better game for it!

The same is true for his relationship with Aonuma - if you're going to make the man a producer, either acknowledge that he has his own vision and let him execute it at least once so that the market can decide if they like it, or move him to a different position or a less critical project where he is given more freedom to evolve as a developer. If you look at movie production as an analogy for a moment, it is known that some of the biggest high-budget creative disasters happen when a Studio appoints a director with a vision and then doesn't let him execute it properly. The public and press usually go on to bury the director for producing such a grotesque waste of resources, when in reality the studio should take the blame - either for appointing someone that didn't conform to their standards in the first place, or for meddling with his work!

We don't know exactly how games are produced inside Nintendo but it is certain that if you are looking to cut some time-wasters and resource-hogs out of the pipeline you should start by looking at Miyamoto's long arm. As was said earlier, games like Majora's Mask which were made quickly and with minimal "upending of the tea table" are considered successful for offering a unique, coherent vision, among many other reasons. IMO this is the same reason games like Twilight Princess are considered over-inflated and unfocused, because they were essentially made by a two-headed producer!

Sometimes Miyamoto's decisions to cancel games that are nearly complete (like in the case of SF2 or Pikmin 3) can be backed up by some form of business strategy, but as you have noted in your original post, having a steady stream of games is also a critical business strategy! Instead of spending countless resources remaking StarFox for N64 or remaking Pikmin 3 in HD, those teams could have instead been making new original projects!

And since Miyamoto is at the top of the developers chain inside of Nintendo, he has to take more responsibility than anybody else. Aside from Iwata of course, whose job it is to keep Miyamoto in check. It can't be that Miyamoto's pet projects are allowed to take years to make and then don't show satisfying results. His continual push for 3D Mario to replace 2D Mario is especially offending. Skyward Sword may be what made me start this thread, but it's by far not the only culprit. It just happens to be the game that takes the longest time and the most people to make and thus serves as the most obvious example for something inside Nintendo going horribly wrong.

This last part is a wholly different issue altogether than the one I have addressed until now, I just want to be clear on that so it doesn't feel like my response here is the continuation of the same line of thinking.

Skyward sword is indeed far from the only culprit, which is why I objected to the thread title in the first place. Smash Bros. for example is very quickly becoming a huge time and money sink for Nintendo, even greater than Zelda. 3D Mario is something you have already mentioned, although I don't really understand where all this hate for not continuing to make 2D games until NSMB comes from, other than reading too much Malstrom

Correct me if I'm wrong, but NSMB was first shown to the public during E3 2004, which would make it about 11 years from the moment the last 2D Mario game was released for GameBoy (Super Mario Land 2: 6 Golden Coins) until development started on NSMB for the DS. Where was Malstrom during all this time? Did he even have a blog? The fact that almost nobody in the gaming industry was thinking seriously about making 2D games for home consoles during this time period goes to show you that the industry was going through a major shift. It doesn't matter if it was the right thing to do at the time or not, being critical of Nintendo after the fact when nobody was smart enough to see it at the time, requires very little analytical or critical thinking skills! Following the DS release with a Wii release is also not exactly the kind of leap in logic that earns you a Nobel prize, you know! And it's not like they forgot about 2D Mario since then, with two announced sequels already far into production.

So what's with all the criticism? Sometimes I think Malstrom gets so involved with himself and his own "grandiose predictive voodoo powers" that he forgets that actually making a game is slightly more demanding and slower a process than simply writing a few paragraphs about why it needs to be made! If anything, I'd say that as long as Nintendo's output roughly corresponds to his criticism within a period of 2 years or so, they probably thought of it long before he did!
/needed to get that off my chest