Honestly I'm all for calling Nintendo and any other company out for something when it's due but here I can't really see it. Yes the Switch has very limited storage, yes it paints not the best picture for third-party support but honestly patch sizes and reasons for these along with install sizes went a bit out of control.
I'm talking more about all gaming platforms now and not specifically the Switch but first of all, why are games still installing/downloading all languages instead of asking me which ones I wish to install? As soon as you insert or start a game a dialog that asks about the languages you wish to install should pop up. Same dialog should ask about uncompressed audio and 4k textures. While it can be of course argued that both of these actually still benefit the user at 1080p and with a TV-speaker audio setup I think making these opt-in would actually benefit the user more than otherwise given how storage constrained even the PS4 and XBOX One can become without hooking up additional storage to them.
Second, I'm all for meaningful patches, post-launch support and DLC if it expands the game down the line. But if a game gets shipped without what was obviously meant to be there at launch only for it to be shipped in a day 1 or day 2 patch the problem isn't the patching system but rather rushed and misjudged deadlines. I won't even think to blame developers for this because I know game-development is harsh enough and it mostly ends up being the publishers fault but seriously a game delayed for 1-2 weeks is better than a game that makes it on time with a 50gb day one patch in my eyes. Fast internet still isn't as ubiquitous as many people seem to think.
I myself "only" have 6mb/sec downspeed which was already fairly expensive, the maximum physically possible I could go for is 12mb/sec where I live and that would be for a price I'm not willing to pay. Meanwhile a friend who lives a few streets further can only get 750kb/sec. And then there are people in other countries with data-caps and worse.
But back to the Switch, I can't see any realistic "solution" Nintendo could have went with to have more storage. They could have maybe eaten the cost and put 64gb in there only to get more production problems and on the long run a 64gb Switch wouldn't have been much different. The only kind of cheap mass-storage we have is mechanical harddrives and these are not viable for a hybrid system like the Switch.
Bulky HDDs can go up to, I don't know, 8tb nowadays? But even a small 2.5" 500gb HDD like in the PS4 or XBOX One wouldn't work. HDDs operate with a motor and a mechanical read-head on metal plate. First, a motor is a absolute disaster for battery-life (see the PSP's UMD drive) and second, in a portable system that moves or can fall down while in use you really don't want to have a mechanical HDD because every sudden, powerful movement can hinder read/write operations and in the worst case lead to the HDD being damaged. It's the reason Sony Diskman had anti-shock features, old HDD based iPod's often had HDD failures and older HDD-based laptops had to employ a handful of tricks with acceleration sensors to prevent all this from happening. And this is all disregarding that even a 2.5" drive wouldn't fit anywhere in a device like the Switch.
So where does it leave it? Well I'm not well versed in memory manufacturing but I'm sure there's a reason why SD-cards get unproportionally expensive beyond 128gb and full-on SDD storage isn't cheap either, especially not at sizes many people wish for. I'm sure nobody would want to see the price the Switch would cost equipped with a 500gb SSD.
And lastly because I've seen a few "lol the Switch is a device that ships with a 720p screen in 2017 while my phone has 4k!" Phones can get away with it because they aren't gaming devices. Run a game like BotW in actual 4k rending on your average smartphone and the performance will be horrible, the phone will drain its battery in probably 30 minutes and it will become hot as hell. The Switch is already mostly battery and people complain about its battery-life, not to mention that 1080p wouldn't really change much in terms of fidelity in handheld-mode, only cause the battery to drain faster and worsen performance for little perceivable gain at the PPI and screen-size.
EDIT: Mind you, I still don't like that Nintendo limits patch-sizes and I think they shouldn't do it because ultimately it won't help anyone but without knowing the full argument from both sides I say both Nintendo and the game are somewhat at fault here.