Except it's not. Nintendo had to market the NES as a toy rather than a video game console because the industry was dead. No one would sell a video game console after Atari basically cratered the industry. Nintendo had to rebuild from scratch and as I'm sure it pains many people to view it that way, those are the facts.
you're talking about a temporary attitude by retailers towards videogames in north america alone. Videogames were still being made and there was definitely an audience for them.
As was pointed out, Arcades were unaffected- consumers were still running out to throw quarters in things like gauntlet and spy hunter. And in this era arcade machines weren't restricted to "arcades" those things were everywhere you had an outlet to plug them into. Grocery stores, laundromats, college rec rooms, the corner deli, 7-11, your local comic shop- EVERYWHERE.
SEGA had already been well into manufacturing the master system, and had a very strong arcade presence. Had there been no nintendo, SEGA eventually would have marketed the master system here- it didn't do much in the states largely thanks to nintendo's anticompetitive practices but was relatively popular in Brazil and EU.
Had nintendo not come along the industry would have looked different for 2 to 3 years, but the end result would have been the same. SEGA, NEC, and other japanese companies would have eventually found a receptive retailer in the states to partner with, OR Atari/Commodore/Tandy/Amiga/Apple would have made greater inroads with computer gaming systems.