Sometimes company do the thing that seems most illogical to us =]
But memory isn't that expensive anymore, I think they could add 256Gb without much cost.
Yeah, Nintendo especially do some real out-of-left-field stuff, like LABO or the Wii Mini, and their systems do tend to have weirdly little internal storage.
unlike thier competitors though,you do't have to basically copy all the data on the disc to the hard drive- nintendo games run just fine on the card with only patches on internal memeory.
ps4/xbone and probably even more so for ps5/seriesx, they need the game installed on disc to even function.
nintendo can probably get away with a 150$ PSTV type console as cost of a tegrax1 dev kit costs under 100$, just need to add a bluetooth dongle, sd port, charger, and a card slot. probably a quarter of the price of the switch goes into the processor, with the screen+memory, joycons, and battery+charger each taking up a quarter respectfully. the switch lite is already 200.