“Nintendo has to overcome that (hardcore audience dislike). A Wii HD would really position Nintendo well, which is why I’m absolutely convinced there is a Wii HD coming. Businesswise, they can’t have people saying that their machine is a toy for my mom.” – Wedbush Morgan (super) analyst, Michael Pachter

I remember something that Mr. Miyamoto said when asked why the Wii was not HD. It went on the lines that “Nintendo believed that at the time the majority of people did not have HD TVs in their homes and probably by the next system the majority would.” I myself did not have HD TV when the Wii came out, I since then purchased one for my gaming pleasure.

Link