I would definitely say that internet gaming on the console has little to no interest for me. This is particularly due to the fact that all online console games have a fee; After I've already dropped $30-60US on a game (if not more), I don't want to have to pay another $15 a month just to play it... The same goes for Xbox Live, on top of the fact that I just simply avoid the Xbox (and once I get my X800XT, I'll be avoiding it even harder).
I don't think anybody can really be honest in saying that they prefer playing against strangers that act like a**-holes online to a few of their best friends. Slapping "online" onto any given game does not make it better; having good gameplay (in any mode) does. The only online games I play are free to play: Diablo, StarCraft/Warcraft, GunBound, and Unreal Tournament (though I don't play them as often as I used to, favoring offline MP games such as SSBM), and moreover, I prefer playing against people I can actually see face-to-face; It's not quite so bad playing online, when the people you're playing with are sitting in the same room.
As for what Nintendo should do, I think they're doing fine. I don't remember where the statistics where, but wasn't the GC the second best seller worldwide, trailing only the PS2? (of course, the Xbox has ludicrously inflated sales in the US) Also, I believe Nintendo is trying to refrain from the sequel craze for the most part; it really kills a series. That's why we didn't see SSB2 for the N64 back in 2000/2001, and had to wait for a whole new console before the sequel arrived. I doubt we'll see another SSB game before the "revolution" project is complete. Of course, in addition to the improvements in graphical quality that would be expected, I can easily think of dozens of new characters, maps, and play styles that I'd have liked to see in Melee. As for Zelda games, I was a little disapointed by Windwaker. However, I can't take points away for its using cell-shading, given that it was one of the first games to try it. However, I'd still say it beats shelling out a monthly fee almost the size of a DSL fee just to play a console game online; I've tried it (thanks to friends), and it doesn't add much.
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"I know there's got to be some sort of mathematical equation for this sort of thing, but I prefer trial and error. It's one of the advantages of having a socialized health care system."
Wake up, George Lucas... The Matrix has you...