Precisely my sentiments.
If Nintendo made a portable N64, for any reason, it'd have to be a special promotion or something. There's no way it could be a public good. The reason why is because if they're going to provide a "new" retro product, they've got to produce games that the product can use. This would mean completely changing their current production methods to accomodate something they thought they were through with.
By going backwards in this manner, they lose any chance of staying ahead in the current market while Sony and Microsoft stay ahead. So instead of completely forsaking you of your oldies, they decide to let both worlds meet. They can keep producing the consoles based upon current technology and perhaps port a few popular classics in an attempt to satisfy those who desire the old N64 software line. You might wonder why they bother when most of their "old fans" react in a spiteful manner, but of course the reproduced games are still fun and provide easy entry into an old market for new gamers.
So yes, this does mean big old bad Nintendo is substantially bound by economic procedure, but at this age you should honestly expect that. This is why its pretty much left up to "fans" to develop these interesting hobby portables. They may not be perfect, costly on a personal level, and not the most efficient battery operated machines on the market, but they allow the small amount of people who desire such a device to indulge on the pleasure without having to expect Nintendo to throw away its money.
Unfortunately, this makes at least some of the creators feel "empowered," and puts them in a place to mock Nintendo for not developing such seemingly simple devices because they are driven by profit. Well, I really only know of one prominent example of such an
individual, who interestingly enough is making his own profits off of not only the portables themselves but books that allow hobbyists to break into his "unique" medium. So, in all honesty, the same profit that keeps Nintendo porting games rather than developing "retro" portables has also driven the small-time hobby that mocked their practices into something substantial and perhaps larger than a hobby. Of course, in the face of a large corporation, I didn't expect people to find the motives of both markets so similar.