No, its fairly consistent for Iwata's placement in the history of Nintendo. He never shied from power or high-end tech, but he'd simply put innovative ideas or in some cases fads ahead of it.
The GameCube is in a time when he was already high-up in creative and control positions of Nintendo, and he had his hands in its development. That was a powerful machine but it was smart, sleek, and small, and its performance was measured in real figures not the BS of Sony or Microsoft at the time... which hasn't abated.
The Wii and its parallel brother were a balance of innovation and competing power. Innovation won on a very good call, but even then there was a strong older brother. Again, Iwata never shied from power but he went with sleek, affordable, and innovative. They could have launched a 400$ Wii360... probably best they didn't.
3DS would have sported a brand-spanking-new chip right off the production run had Tegra done what was needed and what had been pitched (burn those bridges). It ended up weaker but not intentionally so, and ultimately just had its "3D fad" as a selling point aside from "Nintendo handheld".
The WiiU followed sleek and an idea on innovation, it just followed a bad idea. Even then, the hardware it has is good given the time and design ethos, just ask Blu (unless I am misremembering).
Still, all of these systems were designed to be affordable and profitable (gamecube was cutting it close), and the WiiU wouldn't have been a loss-leader if not for the value change in Yen (and the expensive screen controller).
Moreover, given other information we have on hand that I'd say is more than believable, its that Nintendo is looking to make sure that UE4 (not mobile) runs flawlessly on this machine. That gives you a floor on performance right there, and we also know where the CPU generally weighs in at on vague benchmark metrics.
Here's your happy floor for UE4, or, like Sony and Microsoft, you can go lower much to their chagrin: https://wiki.unrealengine.com/Recommended_Hardware
And everything I posted falls into that category unless your money is on a $250 ceiling, which I suppose is reasonable. My point is that there are a lot of reasonable places to place expectations, so I don't think that anyone should call expectations unreasonable unless they actually are such. 14nm isn't "fantasy" by any stretch of the imagination.