in the past two generations, they've tried to differentiate with hardware. while this can lead to great results (Wii), it can also lead to really really terrible results (Wii U).
one general trend that we've seen is that hardware differentiation in the form of special controllers gives 3rd party developers an excuse to not put software on the system or put their B teams to work on the system. we commonly see a developer saying "we don't want to simply port the game over without really thinking about how to use the controller", which eventually means that the port doesn't happen.
another issue with their past two consoles is a lack of power. if they're not on equal footing with other competitors, they won't get multiplatform games, period. this is primarily an issue with their philosophy when designing consoles. they could easily have AMD build them an SoC on par with PS4 or Xbox One, but they wanted to focus on backwards compatibility (this doesn't add as much value as they think) and power consumption (most people don't care about this).
while it's true that they don't need to have a very powerful machine to make great games, it's also true that they need a competitive machine to get multiplat games. what it really comes down to here is a mismatch when it comes to what the market wants (powerful, cutting edge consoles) and what Nintendo has designed their console to be (small, power efficient, backwards compatible).
given all this, I'd prefer if Nintendo differentiated via software instead of hardware with their next console. what I'm referring to is that Nintendo "magic", their exceptional polish, their gameplay innovation. They need to apply that to the software (games, OS, online features). Build a solid competitive console, making it easy to get multiplatform titles, AND build an experience and games on that console that you can't get elsewhere.