Well put, and beautifully written. No real disagreement.

However, I'd like to add that Nintendo's desire to control their licensing was one of the prime reasons that Nintendo never produced a CD-ROM based product. That left a gaping market void that Sony filled spectacularly.

This is a little bit of speculation, but I think if the N64 had a CD-ROM instead of carts, they would have kept Square and Capcom, and PSX would have been another Saturn.