Why does everyone think Nintendo are so far behind? They're not! They make more than enough money to sit quite happily with the GBA alone. The GameCube is profitable, quite comfortably, which is far more than can be said for the money-hole X-Box. They managed to turn a profit with the 'Cube at $200 AU, while Microsoft went nowhere with the X-Box at $300.
And again, how can they get more diverse than with the GameCube first/second party lineup? Zelda and Mario are right there with Eternal Darkness, Geist and Metroid Prime. Not to mention third-party titles like Resident Evil, Tony Hawks, Timesplitters and Soul Calibre. If there's a single major demographic out there that they're missing, I don't see it.
Have a look here. At the end of 2003. Also, the GameCube had a sales growth of 70% in Jan 2004
(here), and sales are getting higher with RE4 out and Zelda impending.
Nintendo has a strong enough market in Asia, America and PAL regions to stay up. They're not knocking anyone dead, but they sure as hell aren't going anywhere.