To address your first point, there are a few others apart from Mario and Zelda. Metroid is a good example, although the recent ones have been developed by a different studio.
Nintendo have always gone for the seal of approval system, as in they've been very controlling on what was released on their consoles. This worked brilliantly on the Nes and to an extent the Snes, because after the
North American Video Game Crash of 1983 people were fed up of substandard arcade knock-offs which were prevalent on the early 80's machines.
There were two things that fucked them over on the N64. The first one was using cartridges over cds. Nintendo and Sony had been working on a CD upgrade for the Snes. That didn't work out for whatever reason, and the technology behind it ended up being the PSX. Whilst for some reason Nintendo stuck with cartridges for their next system.
Might not sound like a big deal, but it meant that they lost one of their biggest game markets in Japan. The big issue? Square. Final Fantasy VII sold near 1 copy per Playstation in Japan. Later on it didn't end up doing to bad in the rest of the world.
Japan's a relatively small market compared to Europe and N.America, but there are other issues with cartridges. Mainly that they are rubbish for storing video and sampled audio, and the big factor is that they are expensive to produce.
Whilst Nintendo were playing quality control on the N64 games, Sony were letting anybody produce whatever shit they wanted for the Playstation. Which worked out brilliantly for Sony, there was a lot of shit, but they were already advertising for an older market. A market which didn't get their games for Christmas, but went out and bought them for themselves.
But don't get me wrong, Your average game on the N64 is better than the average game on a Playstation. The playstation has some proper really bad games, whilst the N64 only has some fairly bad ones. But Nintendo failed to get out of their Quality Assurance loop and let developers fuck about and do something original. Saying that, Mario 64 is the best game of that generation of consoles. It's near perfect in so many ways. And it's only 8mb big, which to me seems like the most amazing thing ever.
I've waffled into a bit of video game history, and somewhat forgotten the point of what I'm trying to say. It was probably that the PS3 is still a bit shit, a year on. Which is shocking.
