That's a good point, but even Nintendo can't always rely exclusively on their IPs. Just see the history of the GameCube and especially the Wii U.
It really can affect the big 3. From the perspective that you mentioned of "why even bother with a home console?" but affecting Nintendo of "why even bother buying a dedicated handheld device when I can play console games on the handheld I use everyday?"
Nintendo as always will have to lean on the strength of their own internal IP and also probably will have to push to make sure the Switch 2 has a considerably bigger display than iPhones (better for gaming) while being cheaper than an iPad. If they can stick in that comfort zone they should be able to do well.
But I think this can help Nintendo ... I think this may actually seal the deal for all big 3rd party games to be on Switch 2. If there was any doubt ... now a developer is going to have to look at this and look at how huge the market is for both Switch + iPhone + iPad + Mac (games they can scale on Apple silicon). And then I'm sure Android is going to now start to make chips that can do the same too.
The market is enormous, it will total dwarf what the PS5 + XBox sell.
If you're Rockstar, you're going to want to make a port of Grand Theft Auto 6. If you're Capcom you're going to want Monster Hunter World 2 on there. But that means Switch 2 is getting those games too most likely because you might as well at that point.
It will be interesting I think to see how it unfolds.