It would actually hurt handheld sales way more than console. I know a lot of folks who only by 3ds because of all the games. If they could get all those games plus nintendos console games in one console they'd stick just with the console. I think at least half of 3ds sales have almost nothing to do with portability. They are buying the handheld despite having no desire in handheld gaming but are buying it just for the games. Handheld and consoles would be more evenly sold in this senario but you;d have a lot of people buying both because both and now more desirable than they were before.

Well, firstly, if you look at Japan for example, they prefer handhelds over consoles cause of the portability by the looks of it and a big chunk of the 3ds sales are in Japan. So thats one thing, secondly, for the rest of the world who don't really care, thats where the exclusivity part that I mentioned comes into play. You have different editions of games for both Console and Handheld that are different enough for people to buy both, then you have games which just work/sell better with handheld than consoles like Monster Hunter, Pokemon, Yokai Watch and etc so you have that too. And finally, the handheld is much cheaper than the console like $200 vs $300 and $40 vs $60 so I think all those things would give enough incentive for people to get the handheld.

Now, the reason why I say that it would cripple the console sales is because if you look at the console front, you have Playstation and Xbox to compete against but I am fairly certain that in terms of direct competition, Nintendo will have zero when it comes to their next gen handheld so I really don't think it would hurt their handheld sales at all. I do think in the eyes of many, as of right now, Nintendo has to convinse them to buy their consoles (cause of all the issues with the wiiU and the wii to a lesser extent) where as their handheld, I am sure most people would buy the next Nintendo handheld regardless of how their console turns out

The docking unit will also contain additional hardware (RAM, GPU etc.) that will allow for more games to be played when in "docked mode"

There will be two consoles, home and handheld. However, they will feature similar architectures so that every game released is for both.
The media will be a high capacity cartridge so that it works on both consoles.
Perhaps the first model of the home console will feature a disc drive but only for backwards capability with WiiU/Wii software.
The console will remain backwards compatible through digital software once the disc drive is removed, or if it's never featured at all.

Something like that I hope.

I've thought a lot about this, I think it'll be basically this:

2 hardware variants. I'm just using these images as a rough example, obviously just add Nintendo styling to it.

Portable (launches mid-late 2016):

Home Variant (Micro Console): Fall 2016-2017

You buy which ever one you want. If you like to play on the go, the tablet is for you. If you like to play at home, buy the home version. 

They both play the same games (3DS sized carts or digital download your choice). The home version has the same chipset architecture, except it has more CPU/GPU cores and more RAM to be able to run the games at 1080P so they look nice and purdy on your 55 inch home display. No huuuuge graphics disparity otherwise, maybe a few extra effects.

It's like the iPhone-iPad model ... if you want a phone, get the iPhone, but many iPhone users also have an iPad to use around the house. They can share apps on both devices and both devices run the same OS. Similar set up here. 

Don't expect a super-duper PS4 type console, either, except something small and cheap. Nintendo's recent job posting for a graphics engineer with specific emphasis on mobile/low power components basically is a huge tip off that they're using mobile (tablet/smartphone) style parts for their next hardware. Something along the lines of Wii U level graphics only at full 1080p/60fps and maybe a few more modern lighting/shader effects. Handheld games will run in a lower 540-720p resoultion. 

I expect the home variant to be very, very cheap as a result, perhaps as low as $179.99 to start with. Nintendo will aim heavily at kids next-gen to get more amiibo selling, the home version will actually be cheaper than the portable one (no screen, no battery to worry about, chip/RAM is cheap by comparision). 

So what format would it use?
3 Options - mini DVD size discs, Flash memory or downloads.They all have their issues.

3DS sized carts. 4GB-32GB in size. Works on both the handheld and home variant (just lke Vita carts work in the VitaTV no problem). 

SD Card if you want digital downloads. Say bye-bye to discs. 

I think almost like a wii u controller that you can take wherever you like.... but when you get home you can play it on your tv with 4k resolution (yeah yeah we are talking about Nintendo)...

hopefully a full hd on the controller.... with oled for the battery and eyes...

2 parts: Console Hub and Portable Controller.

Essentially new handheld will look very similar to Gamepad, except that it won't be tethered to the Hub in the same way the Gamepad is tethered to the Wii U. So imagine Vita. Portable will basically have the power and memory in it to run most games.

The hub has additional power, that enables the games to run in a higher resolution on the TV, also has more memory so is almost like an external HDD for the portable. It could also be a charging station.

So far fairly simple: Hub acts as a way of upscaling portable graphics onto TV, providing a charging station, and additional storage space.

The hub allows the handheld to be a 2nd screen when in TV mode, same as Gamepad does for Wii U. Or, with the extra grunt and a Wiimote, can be used to multi-task stuff like Netflix or simple apps like managing your QoL, Wii Fit, Wii Sports, Karaoke etc. With the portable either being used on its own, or charging, or turned off.

But also allows many people to play at the same time in the same room. If you want 8 vs 8 on one console you can, as each player has their own screen (which has it's own guts to run the game). In essence the Hub becomes a dedicated server, with the TV displaying a map, running scores, highlights for spectators, whatever.

A small number of games could be made to require the hub (similar as requiring Kinect/PS Eye etc.) and use the extra power of the hub to have crazy performance reqs. Probably Ultra HD Zelda, Xeno or whatever. But they would be exception rather than the rule, and would require both the Portable and the Hub to be working in tandem. And these games wouldn't be able to be played away from the Hub (basically like the Wii U Gamepad).

Aside from for the games listed above. The Portable would not require the Hub to function and can be purchased separately (basically encouraging each family member to buy their own). And the Hub would be available either separately, or with a Portable included.

Launch cost: £180 for the handheld, £150 for the hub. £300 for both together. Essentially same as launch price for Wii U.

No 2nd controller other than Wiimotes would work with the Hub. Meaning that for other than the fairly basic games, each new MP player would be bringing their own processor, graphics, memory and screen into the equation. Although only one copy of the game would be required if the hub was hosting it locally.

Those have been my same thoughts since the first rumors of Fusion appeared and then when Nintendo said that both consoles would be like brothers .

Hold a sec, you may be unto something here. After all, their first QoL device will track our sleep paterns... to tell the robotic sex toy when it can turn itself on and rape us!

OMG, we're doomed!