Way I see it right now, Nintendo doesn't need a good launch and product, they need a perfect launch and product. I think they were close, but the devil's in the details, as they say. Here's a list of some of the stuff I would've done differently if I was in their place. The order is just how things surface in my mind, not relative to each other.
The System itself
1. Give the hardware needs more oomph. As people have said, this system looks like an overclocked Gamecube which is nothing impressive in 2006. Even within a few years, unless they squeeze out extra performance, it will start to look overly simplistic and underpowered. By 2009 I expect a lot more people will have HD sets at home, and unless Nintendo cuts the Wii's life down from the standard 5 years, it will look progressively more pitiful on HD systems.
2. Make a damned DVD-playing program available for purchase and download. Sure, most people have DVD players. But if the Wii gives you everything a DVD player has, then not only can you remove a very large piece of redudant equipment from your entertainment center, but if your DVD player does break down or you want to replace it, it's a lot nicer to dish out $15-20 for some software on your slick Wii than to spend several times as much on a much larger self-contained DVD player which will require more cables. Adding the option for a DVD player doesn't hurt ANYONE, and it just might help some people. At the least it would reduce complaints about Nintendo telling lies.
3. Allow for any USB devices to be used for data storage. Then, Nintendo can make standard 2.5 or 3.5" hard drives in Wii-looking cases, or Wii thumb drives. Being standard USB devices they could be used both for typical file transportation (Nintendo fans would love these, no?) and for storing and moving both saved games, game demos, and VC games. And for those who already have external drives, they can use their old stuff. I don't want to get SD cards to transport data, I doubt I'm alone on this.
The controller
1. Rechargeable battery. These days most things use build-in rechargeable batteries: portable media players, laptops, and even Nintendo's own DS. As a result, I don't have anything that requires AA batteries in my house, and have to buy them just for the blasted Wiimote. At $40 per controller bare minimum, these things aren't cheap, and I feel we should be getting rechargable batteries. It's not that AA batteries are expensive or hard to come by, they're just one extra thing I'd rather not have to worry about. I'd much prefer it if Nintendo made a recharging station for 4 controllers, standing them upright or at an angle for display while also giving you an obvious place to put them (because we all know how remotes tend to get lost otherwise) and recharging them.
2. Get it right. They only have one shot at getting the controllers right, and if they don't the word of mouth power of "Don't get that, my son/friend/etc has one and it's too hard to control" will destroy the possibility to expand to larger audiances. What am I talking about here? In a number of videos I've seen, the controller crosshair has been constantly "jiggling" up and down, left and right, shaking just a couple pixels at a crazy rate. This might be because the user isn't holding it per-fect-ly still, or the system isn't calibrated right, or the lights were interefering with the IR sensors, or that the IR calculations were off by a pixel or two each time. Either way it is absolutely vital that they take care of this. Some sort of smoothing operation or feature might do it. If you're sniping for someone, or trying to select small letters on a keyboard, you don't want the crosshairs to be wiggling around like crazy.
3. Cheaper nunchuk . I don't know how much the components cost, but it's lacking a lot the Wiimote has. For example, it doesn't have a 1 megapixel camera to locate the sensor bar, doesn't have a rumble feature, doesn't have as many buttons, doesn't have any memory, doesn't have a speaker, doesn't have components for the batterys... it's a piece of plastic with a thumb pad, two buttons, a connection cable, and an accelerometer chip. Maybe Nintendo is trying to make some money on this. Bad idea. Even dropping the price to $15 would be much more agreeable, they could bundle the Wiimote and Nunchuk for $50 putting it on par with a 360 wireless controller.
4. Put 128 MB of flash RAM in each controller. Check some prices online. You can get this stuff for dirt cheap, we're talking on the order of several dollars to get 128 MB assuming that the price isn't marked up by eTailers, plastic housing and circuitry to hold the chips. Spend a couple bucks extra on each controller, put in 128 MB of flash RAM, and truly personalize it. Carry copies of your saved games with you whenever you take your controller with you (how many times have you heard "Oh crap, I forgot my memory card"?). Carry a small photo of yourself, a small image to be used as a decal (put it on a race car, character armor, clothing, next to your name, over your character's head in Smash Bros, whatever), all of your personal control settings (sensitivity, inverted, button mapping--these will be especially important with Wiimotes I think), and the like. A small price, a HUGE convenience, and something nobody else offers.
5. Number of controllers...?! This isn't something that can really be "fixed" but think about the number of controllers and cables you'll have. First, 1-4 Wiimotes. Then, a nearly mandatory 1-4 Nunchuks (how many game devs are going to make games which DON'T require this commonplace control feature?). If you want to play older games you'll probably want or need 1-2 or maybe 1-4 Classic controllers, depending on the number of people in multiplayer for the older titles. Then you've got 1-4 Gamecube controllers sitting around, as your Wii as replaced the Gamecube hardware, but you still need the controller to play your games (or prefer it, in the case of say Super Smash Bros Brawl). There's the possibility of having 1-4 Zapper shells, if they ever make these, and if they work well. So let's do the math. For 4 people who want to be able to do everything, we're looking at up to 20 different pieces of hardware (with 12-16 being more realistic, as the Zapper might never launch and you probably won't have many Classic controllers sitting around). Let's go by the numbers (for 4 people) : 8-20 pieces of hardware, 4-12 cables, $180 to $340 for the controllers alone (assumptions made: Zapper sells for just $20, and $60 is shaved off each price as the standard system comes with Wiimote+Nunchuk). This is a serious amount of money, and it's only for the controllers which have been announced or previewed. There's the possiblilty for more stuff in the next 5 years...
The software
1. Drop the unspoken ban on more mature games. If you want the Wii to appeal to more people, you need the potential. A lot of people might want to play GTA or other similar titles. Mario and Zelda and Pikachu are all well and good, but sometimes you just want to rip into someone or cleave the head off a zombie. There is some hope though, a bunch of titles for the Wii are first person shooters, a bunch don't look kid-friendly, and there were some violent games for the Gamecube. Just make sure the software library is allowed to grow in this direction, and I think a bunch of people might pick up a Wii just so they can feel like they're part of a headshot-sniping sword-swinging bloodbath.
The virtual console
1. Drop the damn prices. I'm sorry but it's this simple: I already own a bunch of games, or I already have purchased and sold them off later. Nintendo already got their money from me. Those titles, N64 and earlier, have been dead for well over 5 years. Their budgets were not banking on additional income 5, 10, 20 years down the road from software emulation. If they made their money, then great. If they flopped, then they won't be available on the virtual console anyway. Point is, Nintendo GOT their money from us. The virtual console should be a thing to lure back the older gamers. They're not making new titles, they're not improving on old titles. And frankly, I can get N64 games off of eBay for less. Cut each price in half. Maybe you don't make a dime off the service. That's just as well, it's for us: the loyal fans who've already given you support.
2. Offer a one-time fee for the Virtual Console. How about they make an emulator for each system to simulate the hardware? So instead of paying $5 or $10 for an N64 game, I pay $20 for them making an N64 emulator on the Wii, and then every game they have is free or nearly free. A couple cents each to pay for bandwidth and the time it takes to plug a '64 cartridge into a developer kit and copy off the raw data. Would I pay $30-50 for the software to play all of the (now free!) back titles for the Nintendo hardware? Absolutely.
3. Provide special offers and the like. Have the system keep track of the titles you own, and maybe provide the ability to get free games based off of that. Say for every title you purchase, you get a handful of Wii points or for every x titles you buy, you can get a VC game. Or maybe if you have Smash Bros Melee and Smash Bros Brawl, you get the original N64 title for free. Load up all 3 Metroid Prime games, they get added to your profile, and you get one or more older Metroid games. Have every Zelda or Mario title to date? How about a free N64 or earlier title? This works for several reasons. First, the fact that you own all of the newer titles probably means you'd be interested in the older ones. Second, it means you probably already bought the older ones on their original systems if you're that much of a fan. Finally, it makes sure that the developers of that IP already got money from you. Other special offers: Metroid Prime 3 is coming out next week, so here's a nostalgic Metroid title for free.
4. Online demos. Provided you have sufficient drive space on the system or connected storage, you should be able to download (for free) trimmed down demos, video, screenshots, and so on for new titles that are out or will be coming out. I think they offer stuff like this on Xbox Live, they should offer it via the Virtual Console too.
Misc stuff
1. The name for god sake. Yes, the logo is cute and you integrated both the controllers and made it look like people playing and made it sound like a sense of community (in English at least). Does it sound like a serious product? No. Does it even sound like a gaming product? No. It's memorable, but the game is gimmicky and I kinda feel silly trying to describe it to somebody who doesn't already know about it.
2. Drop the price. For gamers, compared to the 360 and the PS3, $250 isn't all that bad (although hasn't everyone said not to compare them? Compared to the closest thing, the Gamecube, it's absurdly expensive at 2.5 times the price, and $50 more than the launch price). But if Nintendo really wants to reach a larger audience, $250 isn't going to do it. $100 for the Gamecube isn't even reaching the majority of gamers, much less Joe Average. Do you think that Joe is going to spend $150 more on what's basically the same thing with photo viewing and the ability to swing the remote rather than press buttons? $200 would be my upper bound for what might start to work. I guess the pricing will get better over time, but as it stands now the pricing is only going to fly for the actual gamer or the rich and curious.
That's "all" I can think of now. So yeah, that's stuff that Nintendo should've done or should think about doing.