It would be expensive yet still sell at a loss. It would bring in all the riffraff of shitty developers with buggy games, and would sacrifice Nintendo's individuality and make it nothing more than one of three interchangeable consoles. Like LG in the smartphone business (when's the last time you saw someone with an LG?).
That may be how marketing works, but that's not how accounting works. Nintendo is still a business, and simply cannot sell a console for $200 that costs $600 to make (including parts, assembly, R&D, marketing, etc).