In the end the Wii U will make them money at the 200-250 price range and when they market the thing.
I don't see the gamepad as the problem like some think. The Wii U name is a mistake as well as the actual Wii U console looking like the Wii.
I think that with
- Wii HD as the name people would get the idea better even with the gamepad
- Differentiate a bit more the actual console and focus attention on both the console and the gamepad
- Split the marketing between the gamepad and the Wii motion controls but showing games in HD. Why not release at launch a Wii Sports 2 and Nintendo Land together, and see what works best. Even if the gamepad is not being understand they could start with a 50-50 split between gamepad and wii motion controls and during its lifecycle to start and give more importance to the gamepad.
edit: if they have trouble with 3rd parties I agree with some on Nintendo expanding their IPs and having 2-3 mature titles, one big FPS or TPS Multiplayer game and at least one big action/adv game. Even if it does not make them money it could begin to change mindsets about Nintendo and further diversify their lineups.
edit 2: right now they are betting heavily on indies and I think this will eventually pay off. I am sure they see more interesting ideas on the indie space than on the AAA games. The Wii U is a capable console and they were betting on more 3rd party support, they should learn the lesson and have a stronger launch next time.
I think N64 era Nintendo would make the typical games in the genres that are popular now, but this newer Nintendo has Platinum making Wonderful 101 and Bayonetta 2 as marquee titles. It's making a huge open world JRPG. It collaborates with western developers to make games such as Punch Out and Luigi's Mansion and Lego City. It's somewhat beautiful that they are choosing to make games that are not typical and as a first party present them as marquee titles. (Personally I want N64 era Nintendo to come back in a way.)
Also I think Art Academy would be the better game to bundle with the Wii U, along with Wii Sports U and a Wii Remote+ and Nunchuk. With Art Academy, it's obvious what the gamepad lets you do: You can draw. Sure the gamepad does more, but to make it simple and easy to market, just say "You can draw on it." Let that be a Trojan horse for getting the gamepad into people's hands. They can fall back on Wii Sports U as well.
Personally, I think the Wii U has the potential to bring back some of the DS's cool ideas and present them with the visibility of being on the TV in HD. Things like Style Savvy, Nintendogs, etc. I was going into the E3 Nintendo Direct thinking "Will I get to see X?" but it was after Iwata revealed Art Academy that it really hit me that the Wii U is an ultimate version of the DS and Wii. Nintendo has shown that it is willing to spend money on making high quality casual games, even postponing Wii Fit U and Wii Party U to polish them up (or was it to pad the release schedule?) These casual broader, "non core" games sell, as attested by Minecraft and Animal Crossing recently, and while the M-rated violent games are all the rage, there is a huge opening for companies to actually give a damn about that market and respect it instead of making quick cash grabs.