For a whole lot of software companies, the main competitor is the old version of the software.
Same for Nintendo: Newer games might be nicer to look at, but old games are just as much fun. So working older copies of their games do cost them money, and they'd rather see them disappear.
Indeed. This is a bit aprocryphal but I believe to recall reading about them attempting to shut down second-hand video game shops using legal threats somewhere in the 90s?
I guess this is it: Nintendo took Blockbuster to court arguing that rentals constituted copyright infringement. They also sued Galoob for the Game Genie under the premise that using the Game Genie to alter the game in any way constitutes producing an infringing derivative work. They lost in both cases.
Same for Nintendo: Newer games might be nicer to look at, but old games are just as much fun. So working older copies of their games do cost them money, and they'd rather see them disappear.