The Xbox itself is a good product. They overlooked the market the Wii pursued, but then again everyone but Nintendo did. If I recall Nintendo has never had an unprofitable quarter, even during the GameCube days when they were doing much less volume than the competitors.
Moreover, they've just begun to capitalize on it. As I said, they've got an internet connected box tethered to everyone's TV. They've been working on the dream of the living room PC for years, and now they've finally gotten there.
Teenage male bedroom TVs perhaps. Lets not get carried away here.
And I consider myself a pretty "hard-core" gamer.
Nintendo played a blinding strategy - let Sony and Microsoft play "Who has the biggest willy" with their hardcore gaming hardware which renders 4 gazillion polygons a second, while Nintendo makes fun games with wide appeal.