Michael Pachter is known, as he acknowledges in this video, to have a pretty poor reputation with Nintendo fans but he isn't going to back down because of it. Pachter is always going to speak his mind, and yes, as some point out, ignore some key questions such as the 3DS' success in Japan. He does have a few good points covered in his latest Pach Attack however.
For starters, Nintendo would definitely sell more software units in truck loads if they didn't restrict to their own hardware. They could dominate the mobile smart-device market and would easily have some of the best selling software every single time on the competitors consoles. He feels Nintendo won't leave the hardware business even if it's not very profitable because it's what they have always done. They will continue to do it, and he admits they can afford to continue to do it for 50+ years if they want.
With Iwata being a bad CEO, it comes down to the decisions the last two years. There are some counter arguments of course to the claim that he's a bad CEO. Take the peak all-time high of Nintendo's stock - that also happened under Iwata's watch. It also was inevitably going to crash because that's the nature of the game business. It's true Nintendo probably doesn't make that much profit off their hardware - but they are notorious for keeping a price on a product for several years. Wii U will probably sit around $300 USD for at least 3 or 4 years before they slice it. While some of you may feel that's a bad decision, if the console is selling well there is no reason to drop it. This also ignores how Nintendo fundamentally feels the focus of the industry is on the wrong aspects, and they stick with their hardware to prove that point. Without Nintendo hardware, you would lose a lot of innovations.