The "Seal of Quality" was never a metric on the subjective quality of software. It was literally a functionality seal, to help matters in a very unconfident and paranoid market.

To this day Nintendo doesn't consider quality something that can necessarily be dictated from a central position, as quality is highly subjective. The restrictions on game releases(and third parties as an extension) originally came as a control measure to deal with lack of confidence in gaming from the Crash, and to avoid such scenarios where retailers become too nervous about the market.

A lot of people don't like to recognize that, but even though some may consider them draconian, the presence of restrictions as a working asset and a PR item, played an important role in successfully reviving the market at that time.

The seal was originally supposed to mean the cartridge was durable and functional by the standards of Nintendo, not that the subjective quality of the game was high. To this day there's nothing to truly, successfully gauge that.

The seal was changed in 2002 when Iwata took over to help bring more 3rd party support as the iron grip control was let go.

So up until 2002 it hads the words "Offical  Nintendo Seal of Quality" after 2002 it just said "Official Nintendo Seal"

The quality seal was created to prevent the same thing as the atari 2600 mistake from happening again.

They were trying to guarantee quality in their products.