I think it's a really smart strategy. They avoided the raw-power hardware arms race and are thriving because of it.
It seems like Nintendo picked up on what makes video games so fun early on while a lot of studios struggle with it even today: The gameplay comes first and it has to be fun. Art/style comes next, then way down the list is graphics. Graphics are the only thing about a video game that get worse with time. If you focus on making fun games that have a distinct style, they will remain fun forever. Importantly to a corporation, they also remain sellable forever.
Nobody talks about crysis 1 anymore, but people definitely talk about wind waker.
Totally agree. And Zelda is maybe the best example of this? The graphic style of the two recent games are distinctive and effective but are a long way from realistic by modern standards.
It seems like Nintendo picked up on what makes video games so fun early on while a lot of studios struggle with it even today: The gameplay comes first and it has to be fun. Art/style comes next, then way down the list is graphics. Graphics are the only thing about a video game that get worse with time. If you focus on making fun games that have a distinct style, they will remain fun forever. Importantly to a corporation, they also remain sellable forever.
Nobody talks about crysis 1 anymore, but people definitely talk about wind waker.