One is certainly allowed to have a monopoly over their own products, that’s what trademarks and patents are for.
It’s hard to argue a game developer is forced to play ball with Nintendo.
There are a whole lot of ways to distribute a video game. Three major consoles. Computers. Things like the steam deck. Smart phones. You could ignore any one or two of them, and still have a great business. In fact, lots of companies do. A whole lot of people have access to more than one of these platforms. You could ignore anyone or two of these platforms, and still sell your product to most of the people in the market. It is a highly competitive environment. If you don’t like Nintendo’s policies, just sell on Xbox and PlayStation and steam. People do this. If an environment is competitive, then by definition, nobody has a monopoly or an unfair advantage.
The Earth has 8 billion people, most of whom have a smart phone, all of which are using one of two operating systems. Not many people have more than one. If Apple says your app cannot be in their App Store, half of humanity, cannot use your app. It is a much different scenario.
Your monopoly point is an interesting one. Wonder if there's an actual legal case there, as Nintendo have done a lot of this bullying over the years.