My personal theory on why this is happening, the real problem behind the software decline on Wii is that 3rd parties refuse to put their best stuff on the system, and the real reason 3rd parties hate the Wii and every last ounce of it's success (thus not putting their best stuff on the machine), can be boiled down to a very simple concept.
A power struggle.
In the 8 and 16 bit days, while there was a definite 3rd party influence to some extent, systems were largely built on the success of 1st party efforts. Final Fantasy, Dragon Quest, Castlevania and others surely helped make no mistake, but Nintendo's fortunes in the market share were due to Mario, Zelda, Metroid, Kirby, Donkey Kong etc. In the same way, Sega's fortunes in catching up to Nintendo in the US were largely defined by Sonic, Phantasy Star, Ecco the Dolphin etc. Even if fanboys remember the 3rd party efforts more than the 1st, it was the 1st party efforts that gave direction to the industry.
Then, in the PlayStation era, a paradigm shift happened. Sony's success was largely defined by the efforts of 3rd parties like Square, Capcom, Konami etc., creating a culture whereby in the PlayStation 2 era, 3rd parties got used to the idea of hardware manufacturers catering everything to them. Metaphorically bowing and scraping at their feet (read: moneyhatting) for them to pick their platform for their all-important franchises.
Betting on the success of the HD twins, the unimaginable (in their eyes) happened; Nintendo regained the lead with the Wii, grossly outperforming the 360 and PS3. Passing it off as a fad, they kept working in HD, but when it came to pass that the Wii was not a fad, many 3rd parties went to Nintendo expecting them to money-hat to get their efforts on the Wii, just as Microsoft and Sony did. But Nintendo didn't see the need to do so. In Nintendo's eyes, they should have put their stuff on the Wii because it was the leading platform, not on the promise of mounds of money.
Miffed, 3rd parties did everything they could to destroy the Wii by continuing to put their worst teams on the system while heavily promoting the greatness of the HD twins with all of their biggest franchises. Yet despite their efforts, Nintendo continued to succeed.
And THAT'S why they're so disgusted with the machine. It's not the tech or the motion controller (though they are factors); it's the fact that Nintendo has taken their power to direct the industry away from them by succeeding in becoming the industry leader again with next-to-no help from the 3rd parties. With no moneyhats, with no bowing and scraping, Nintendo has continued to dominate while 3rd parties continue to try and hurt it by not putting their best efforts on the system, flooding the Wii's market with shovelware after shovelware. 3rd parties efforts on the Wii can sell, especially in Japan (see Monster Hunter 3) when they DO put their best foot forward on the machine, but they don't WANT that to be the case. They continue to hope for the day the Wii falls, so that they can reclaim their places as the industry directors, those who decide what does and doesn't succeed in the industry. They had the power to propel the PlayStation past all of the competition for 2 whole generations, and now their efforts can't do a thing to propel either HD system ahead of the Wii.
They hate the Wii because it succeeded almost solely on Nintendo's efforts, not theirs.
EDIT: I forgot to clarify why this is such a huge dilemma for 3rd parties. The thing is, most 3rd party developers are staffed by people who grew up loving videogames, and are every bit as much fanboys/girls as GAFers. They want to make their ultimate games, despite the budget. They've been able to do this because, in a culture where they hold the power, they can practically force hardware makers to give them money to make their games, thus lowering their risk. This generation, they've been able to convince their publishers/shareholders that it's too late to put their stuff on the Wii, because they've already destroyed that market, and thus HAVE to keep pushing their budgets for the HD twins.
However, I can almost guarantee you that when Nintendo unveils their next home console, that excuse won't work anymore. Shareholders will insist that they put their best efforts on Nintendo's platform out the gate, as they won't be made fools of two generations in a row. But Nintendo isn't going to help them fund their projects either, so now they actually have to be mindful of their budgets, something this generation has clearly proved they're not accustomed to. Meaning they're not in a position of power where they can demand the funds they want to make their dream game, now they actually have to deal with making a great game on the budget they're given, and they don't want that.
