No, they'd be dooming themselves to sub-GC level sales if they did that (every generation they lost over 10 million sales making "basic" systems). At least with the gimmicks, they have some kind of chance to succeed, as proven by the Wii.
As far as handhelds, I think the dual screen thing is here to stay. The DS is Nintendo's most successful platform ever, and the 3DS is going strong.
Having played the X1 and the Wii U, I personally don't want Nintendo to just go back to doing a "standard" controller.
You know what I felt when I played the X1? "Sure, the graphics are better, but this is plays just like my 360. Minor aesthetics aside, it has the same controller. I don't think I can justify shelling out $500 for a graphics update. Even if it means waiting to get some of the games that will come out for it."
Yes, having a more powerful console can enable things that aren't possible on the 360 and PS3 (gameplay mechanics like in Project Spark, better physics engines, etc.), but at the end of the day, it still felt like the same old stuff we've been playing for the last 7 years. That may not be entirely a bad thing, however, if we're going to have 3 different consoles come out, I want different gaming experiences from them. I don't want to have to buy them for their exclusives alone.
I appreciate how Nintendo is at least trying to create a gaming experience that differs from the competition. While I appreciate the Kinect and Move for trying to do the same, I have yet to find a game that appeals to me on those platforms. With the Wii U, I see potential. Sure, it's current library and release list is lackluster. However, if developers decide to put in some effort and take some risks, we could have some really awesome games that are both fun and offer a different experience from what we're going to have on the other consoles.
Will Nintendo go back to doing just a basic controller? I don't know. With Iwata, probably not. However, they are at least offering a basic controller for people like you, who are content with just that, and something different for people like me, who want a different experience with each console they buy. Why must people b**** about it so much? >_>
I also really hate how the buttons are below the right analog stick. No one else's consoles do that. Not even Nintendo's last console. It's so terrible going from any other console to the Wii U because of that.