Why does Retro even exist anymore? Their output in the 6 years following the unveiling Switch - which isn’t exactly a demanding console to develop for - has been a single port of a Wii U game. Said game is the only thing they have put out in over a decade.
Well first of, Nintendo hindered/interfered with them several times when pitching projects and you know what that does to morale. They're Nintendo, so most of the time they had a green light to pitch stuff it wasn't like they were doing this behind everyone's back, and then get rejected.
The story for the concept pitch is amateurish, but we don't know how many proposals they did before this one as it usually gets to a point where you should care but can't anymore, you simply don't know what is working or not anymore due to much refusal. Also, Nintendo is the sort of parent company that will order you around if they think they need to change things to whatever they want so it's usually the gameplay idea that has to entice them. Like the time they ordered Retro to stop doing everything they were doing and gave them Metroid, or the time Dinossaur Planet to become Starfox Adventures because a character in there looked like Fox.
If the Zelda department wanted to enforce any change they would. That said, seeing these pitches were going to Aonuma and Retro had an awesome track record back then, I'd say if it was his call they never had a chance. Aonuma would be afraid of them taking the franchise from him or reviewing better and would be rooting for them to fail (he's clearly not a team player if you're not on his side or his boss). So it's probably a good thing this didn't happen.
Second, they contributed as co-developers to several Nintendo titles in between.
Third, they are at work with Metroid Prime 4.
It doesn't look good, I agree, but it's not all on them, it would be unfair if Nintendo closed them because they threw all their work into the trash. Sometimes Development Hell is created by the situation and not the projects. Starting stuff and not finishing is also dev hell.
I don't know what the fuck is going on with this team but my confidence in their ability to make a worthy successor to Metroid Prime 3 gets lower everyday.
People who were there during the Gamecube and the Wii days are residual now at best.
They've been massively hiring for Metroid Prime 4. Best case scenario for them is if they hire a lot of Arkane Software personnel tbh. Prey 2017 had this Metroid Prime vibe and Dishonored 1/2 had a Zelda in first person vibe minus the in your face zelda puzzles. And part of their workforce is located in Austin, same place where Retro is.