That's true, they are very wealthy and may make money. But it looks like they keep losing market share and in the West, it looks like they keep losing popularity, even amongst fans. They might be far from dead but it does look to me like the end of the console manufacturing Nintendo has begun. And a handheld or mobile phone Nintendo is something a lot of people would see as a Nintendo that has lost, even if they would make a lot of money.
Perhaps it's just wishful thinking on my part but it's very very obvious to me that the NX will be fixing the majority of their dedicated hardware problems:
-First, one of the main reasons the Wii U failed -which people often forget- is that Nintendo was focusing most of their development time on the 3DS which failed to sell nearly as well as they had hoped. The 3DS started selling quite a bit after that software came out but then the Wii U started sputtering because there was little in the way of software support after launch. So in essence the 3DS was one of the reasons the Wii U failed to sell.
One of the things we KNOW is that the NX will solve this problem because they have combined handheld and console divisions and made a conscious effort to make development between two devices much easier. This information came straight from Nintendo.
-Second, Nintendo has discussed several times that they do not like the console cycle which creates this situation of the consumer buying new hardware and then "starting from zero," library and install base wise. I believe it was Iwata who said that one of the main focuses of the NX is to set a single unified games platform going forward, such that every subsequent NX system (or SCD upgrade) will be backwards compatible with previous NX systems, and that publishers will feel confident releasing their games on new systems because they will likely be able to be compatible with previous systems. Forward and backward compatibility, essentially.
This is in stark contrast to how the Wii U works, and in stark contrast to how the Wii U to NX transition will work, unfortunately. Unless of course the "absorbing the Wii U architecture" means that they have a BC solution, which I doubt.
-Lastly, Nintendo has made it clear that they want the young guys (Splatoon garage-type teams) to start having greater input in not just the garage games, but the future hardware and overall direction of the company. This will likely revitalize some of their stagnating IPs judging by the success of Splatoon, and should be taken as an indication that Nintendo understands that some of their past decisions have been a bit old fashioned.
This all indicates to me that Nintendo is in a major period of restructure, and are focusing greatly on improving their dedicated hardware business, not at all backing away from it. You may get that idea from games like Federation Force and the new Paper Mario, but I see those games as essentially filler games that weren't considered important enough to be delayed to the next console. Again, that could be wishful thinking but I think it's clear that they have solved or are in the process of solving a great deal of their hardware problems.
Now none of this addresses third party support but that's a whole other animal which isn't necessarily that relevant to your point.