There's no chance of cartridges coming back; they have been obsoleted by optical media. Nintedno kept going with cartridges too long.

Yep that's very true, although I do think they will just stick with one entry of Mario Kart and support it with DLC, which brings me to another strong point, the the increase of DLC sales. Currently we have MK7+MK8 which have sold over 16 million combined but only about 1/3 of that has access to DLC whereas with the proposed idea of one Mario Kart game on both devices allows for 100% of customers to have access to the DLC.

Nintendo doesn't have to justify shit. It's their franchise, they can do with it what they please. 

Consumers have no problem paying EA $60 every year for a new Madden, FIFA, NHL, etc. etc. You can use this arguement for any sequel based franchise out there. Why did Sony release a LittleBigPlanet 3? Couldn't they just have released it as DLC? Why do I have to pay for Tekken Vs. Street Fighter? Can't they just release it as a DLC pack for Street Fighter IV? You bet your ass there will be seperate Destiny 2,3,4, etc. but it could probably have all just been released as DLC. 

Nintendo is absolutely under no obligation to give away two games worth of content through one game + some DLC if they don't want to do that. 

Any more than there was a gun to their head to offer Super Mario Galaxy 2 as a $20 DLC update to Super Mario Galaxy 1 or something. It's totally under Nintendo's discretion to do with a franchise as they like. Many people refuse to buy DLC, releasing sequel-content as DLC is not a sound philosophy for a major franchise unless the additions are minor. 

The real reason more than likely that previous Nintendo consoles/hhs haven't gotten more than one Mario Kart is because it takes on average the Mario Kart team about 2 1/2-3 years to make a new one, so by the time they finish making one for their handheld and then another one for their home console, the next wave of their hardware is generally already in development phase, so they move on to the next cyce (ie: DS got Mario Kart in 2005, Wii in 2008, 3DS in 2011, Wii U in 2014). 

This may be for a different topic, but since we're discussing the next console shipping w/o an optical player, how big (or small) do you folks think Nintendo will make NX home version?  I can envision Iwata presenting the console in the palm of his hand

Very small. Probably the smallest console Nintendo's ever made, and they've made some very small ones, the OG Wii and the redesigned Famicom are tiny. 

That said, I actually think there could be more than one home (console). There could be one made for Japan and what Nintendo deems the "family market" and one made for the tastes of higher end Western consumers. If NX is supposed to be one unified software ecosystem and the hardware is more tailored through different models to be able to appeal to very different markets and consumers, then I wouldn't be so quick to assume that there can only be one home model either. 

Probably about the size of an Apple TV. I think things like Apple TV & Roku will be just as big or bigger competitors for Nintendo than Playstation & Xbox.

Yeah with the new unified sw approach, Nintendo can experiment with more HW types.  When Wii became a big hit, everyone said "if only it was strong enough to handle 3rd party games".  The audience was there but power wasn't.

I think for starters Nintendo will be conservative and if there is demand, maybe a year later, releae something that eclipses PS4 at the very least.

Will the thing even need a fan?  lol

I've stated how I think Nintendo may abandon the traditional console cycle of 5-6 years and instead do smaller upgrades every 2-3 years similar to iPhone/iPad but not quite as frequently.

Probably not, do any cartridge based devices have fans?