The problem is the dedicated handheld market is dead outside of Japan.  It doesn't have a long and positive future.  Kids want an iPhone or a tablet nowadays instead.  And out of the roughly 15m that bought the Wii U I'd bet at least 10m have the 3DS. 

Where did you get your Microsoft numbers from?
they never reported operating income for the gaming division seperately.

Only gross margin. And even that gross margin did not include all parts of gaming

Of the roughly 60 million 3DS units sold, nearly 40 million are from outside of Japan.

Look at software sales outside Japan.  They don't paint a healthy picture the last few years for dedicated handhelds.  And that includes the vita.  The market is dying because there is no demand and Nintendo on their own cannot sustain the market on their own in the west.  

To their credit they make a good effort but it's just not going to happen. 

You're missing the point. The 3DS did good but not the last few years. The market completely moved on mid gen. There was a big potential market when the 3DS launched but there won't be when the NX launches.

Well splatoon sold better than almost anything they would have pulled off.  The point is even if they dumped one then it's not enough.  If all games go on both then overall hardware sales suffer because their hardcore fans no longer need to buy both.  And I firmly believe a large chunk of their potential market has moves onto smartphones. 

So instead of responding to the post I wrote to you addressing this exact thing, our going to repeat what you already said to someone else? Makes sense.

I've numerous people replying to me in 2 threads about similar things and I'm replying in between matches of rocket league as the next game loads.  Hard to keep track.  What did you say? 

You aren't factoring in people who own neither a 3DS or Wii U that may buy at least one NX sku.

Lets use the 2015 releases as an example, lets say someone wanted to play Monster Hunter 4, Majora's Mask 3D & Happy Home Designer but those 3 games weren't enough for them to buy a 3DS, lets say they are also interested in Splatoon, Super Mario Maker & Xenoblade X but again those 3 games aren't enough to buy a Wii U. Would that person be more likely to purchase a single device that plays all 6 of those games?

Another factor that you aren't considering is the increase of software sales, certain games have been hindered by the fact they are stuck on a platform with a small userbase. Splatoon & Mario Maker are big successes and will each sell 5+ million but what if they had the entire 3DS audience to sell to as well? These games could very well sell over 10 million.

A third major factor is that Nintendo can diversify their lineup by not having to make 2 separate entries of many franchises. Instead of releasing a Mario Kart title for the handheld then 3 years later another Mario Kart for the console, they can release one and support it with DLC then release a new IP 3 years later. This potentially leads to more Splatoon-like scenarios of new, exciting franchise being created which increases the devices appeal.

What you're not factoring in is that it's simple mathematics. If both consoles have the same library a lot will settle with one console instead of 2.

And releasing two separate skus of games boosts it's sales. Many Nintendo fans buy the handheld and the console editions. now they won't in many cases.