I just noticed this Reuters article at Yahoo! that gives a pretty good overview of Nintendo's current situation. It sounds as if they at least recognize the problem and are interested in doing something to remedy it.
The U.S. release of Zelda: The WindWaker this month will probably nudge sales a little, especially since the console is currently selling for $149 and includes a free game. However, even Nintendo realizes that one game does not a successful console make.
"The real question is, as we start 2003, what are we going to do differently?" George Harrison, the senior vice president of marketing for Nintendo of America, told Reuters in an interview. "For us it's about trying to get the GameCube business moving and restore the confidence of the licensees."