One of the key weaknesses of the Wii, as opined by many, is its graphical capabilities. I believe this may be true. Setting aside the issue of gameplay vs. graphics I believe that if the Wii is graphically underpowered this is having an effect on the sale of games for the system. Why? Because I believe it's easier to sell a game with new graphics than it is to make a unique game offering created by talented people.
The graphic capabilities of the Wii have probably not been fully tapped but they are most likely fairly close to being fully realized. On an even more important note the graphics that the mainstream game buying public is demanding seem to have been satisfied on many fronts. Without the lure of new graphics, or indeed, even the need to produce them, the developer is faced with the dilemma of having to rely on the creation of engaging gameplay and talented execution.
For these reasons I believe the Wii presents a challenge to developers that only the first and foremost of developers will be able to tackle successfully in a way that is popularly and critically pleasing.