Someone said above one great example that I could have said earlier too. PSvita is a good example of good hardware at a somewhat affordable pricetag.

If you look at the best of the 3DS vs the best of PSvita you get this:

On paper, PSvita puts 3DS to shame. But comparing actual games made for the consoles is a better comparison. 

You can see which one is superior (and 3DS is processing an extra screen and 3D effect on the upper screen!). This is about the same difference I am expecting to see for the Wii U against PS4. And both of this titles are not showcasing the best of both platforms, I think we could all agree on that.

I personally find virtual tennis better good looking technically.

I don't think hardware power matters much to the mass market and Nintendo is smart enough to know that.

We have a console with basically 2001 technology on the cusp of selling 100 million consoles. It is obvious the mass market cares more about games, affordability and user interface.

Nintendo would be smart not to make a super powerful system but instead keep the cost low and throw in the tablet hook.

Some argue that Nintendo will miss out on a lot of 3rd party games again when PS4/720 come out. I dont think this will be the case because

1) Nintendo is much more active getting 3rd parties on board. They already have (timed?)exclusives such as DQ X, ZombieU, P-1000, Lego City Stories, Scribblenauts, Rayman on their platforms. And they are getting many multiplats as well.

2) The power difference wont be as big as it was with the Wii to 360/PS3. It would be much easier to down port to the Wii U

3) I dont think many companies can afford to make such big budget games and not port it to the Wii U. If so many companies went under this generation because of developmeny cost how much worse will it get with PS4/720? 3rd parties would be really stupid to miss the Wii U boat as they did with the Wii.

I think Nintendo is in the healthiest position because they will have at least a 1 year headstart building an install base, has a nice Wii U pad and asymmetric gameplay hook (but Sony and Microsoft may copy), will still use Wiimotes, fully backwards compatible, likely to be the most affordable, and likely to have most of the multiplats PS4/720 will have. Let us not forget Nintendos stellar 1st party games.

What new are PS4 and 720 going to bring to the table? I dont think just more powerful hardware is going to cut it. We have reached the point where the mass market wont see much difference.

I'm sure THIS will be the case.  Despite at least one person thinking that titles like FFXV and MGS5 will NEVER hit the WiiU console, I think the opposite is going to be true, because even if they are multi-plat, if costs really get that much higher, it'll mean even more losses, and nobody wants to have that happen again.

I do think the same about Mario 3D Land on the 3DS, but I wanted to give examples of games that are somewhat the same, adventure like with big environments.

On virtua tennis the console is just rendering a court and 2 players, Uncharted is pushing much more than that.

Anyway, the first batch of Wii U titles doesn't make it justice. Take a look at launch 360 titles, some ports from PS2 gen:

Nothing like Alan Wake and Gears of War 2 and 3....

No, they never released the specs officially. Indeed, one of the threads in the Nintendo discussion is revolving around how an official user manual for the Wii CPU has just now surfaced in the wild...

Consoles are not PCs.  Consoles aren't running memory intensive operating systems and multitasking with multiple memory-hog progams at once.

Go check out the specs from older consoles on Wiki and you'll be even more shocked... did you know the original PlayStation had a whopping 1MB... that's ONE MEGABYTE... of dedicated VRAM?

PS1 also didn't process 3D graphics on its discrete GPU (its video unit did 2D only, 3D done by the main LSI-built CPU)

To be fair, even PCs back then didn't always have dedicated 3D graphics cards. I used to run Tomb Raider, Quake II, Half-Life and Age of Empires in software mode. Graphics cards like the VooDoo were only just starting to take off.

Until late 2014 (at the earliest) most third party published "hardcore" games will be designed around the PS3 and XBox 360 and then enhanced for next generation consoles. After that I expect 2/3 of these developers to continue producing games with a similar budget and to improve graphics as much as they can afford, and the other 1/3 to produce the best looking games they can; with the low budget games I don't think processing power will impact their decisions on which platforms to target, and the Wii U will become the base system for the big budget games if it sells enough.

The "casual" and "crossover" titles will (probably) not be limited by the processing power of the Wii U ...

Or to put it another way ... I don't think that the processing power of the Wii U will be an issue for 90% of the games made for the next generation of systems.