I don't know what you're talking about. Dreamcast had a lot of awesome games ... right out of the gate. The reason they failed was because they had morons running the business and the 'at the time' president ended up putting $700,000,000 of his own money back into the business just to pay off the company's debt. They just weren't making money for a long time.
People can't seem to get it through their heads either that just because 'they' don't own a Gamecube that no one has one and somehow Nintendo is stuggling. Nintendo is always making a profit, they are no where close to the shape that Sega was in. They profit by over a billion dollars a fiscal year. The last thing I read said they profit by just as much as Sony.
Additionally, Nintendo's software and hardware are intrinsicly tied together. Any Nintendo player understands that if you took the game and put it on another platform it wouldn't be the same game. It'd be like taking your girlfriend's mind and putting her in some other person's body would she still be the same ... HELL NO! If you don't get that you are simply ignorant to what makes Nintendo ... NINTENDO.
Yeah, on top of that, it's Nintendo's handheld market which is their big-time saving grace. The DS is by far and away the best selling handheld around, if I'm not mistaken. The PSP tried, but the DS seems to be outselling the PSP... Now with the DS Lite around the corner, it'll only capitalize on this. Nintendo seems like they'll have a winner in the Wii, or at least tied with the X360, putting that $600 monster from Sony deep in 3rd place due to that price tag. AFAIK, Sony's days of domination are over with the PS3...
Sony would be a little tough to dethrone, but with the console company that started it all after the mid-80s crash, Nintendo could reclaim that #1 title this next-gen round...