MS isn't too against Rare games being on a Nintendo handheld since they don't have a portable of their own. But Rare themselves really just don't make very good games anymore. I'd love to see a remake of Banjo 1 or 2 on 3DS, but the odds of that happening are very low, and the odds of them being good are even lower. They ruined the DKC GBA ports without good reason. And Grunty's Revenge on GBA was very bland, even though it had the gameplay and every chance to succeed. I just don't think the magic is there anymore. I attribute that to most of their original staff having left now. They're also arrogant and still think they're top stuff. They even like to treat gamers like idiots by teasing gamers with a new Killer Instinct every year.
I don't think Rare likes Nintendo much anymore except as an outlet to make a quick buck. And i doubt they'd ever make another Banjo game for their systems even if they could. They even took the effort to remove Banjo, Conker, and Tiptup from the DS version of Diddy Kong Racing. For no apparent reason... The only Banjo games they've made for Nintendo systems since the merge with MS were Banjo Pilot and Grunty's Revenge. Banjo Pilot was originally Diddy Kong Pilot and wasn't even a Banjo game at all originally. They swapped the graphics out basically. And then Grunty's Revenge was initially canceled and wasn't going to be released. Funnily, both GBA Banjo's had to be picked up by THQ for publishing before being released. Both games had very shaky development and it's amazing that they even finally came out.
Rare has actually given Nintendo the right to release DK64 on VC, they mentioned that they wondered why it wasn't released yet. But i think Nintendo just doesn't want much to do with Rare anymore. They've clearly moved on with Retro Studios to create their own DK game. As for Banjo games, if another ever gets released on any Nintendo system, i'll be shocked out of my mind. Pleased, but shocked. But after what they did to the 360 game, unless it's a port or remake, it will likely be underwhelming.
NEVER judge a game you have not played. -Granville
Microsoft owns Rare but they also don't had a portable game handheld of their own so yeah it's entirely possible for them to release games for the 3DS considering they like Nintendo's handheld more than Sony's.