Hence a handheld would have served well for small hit games, including backward compatibility with XONE/360, it could have also been a catalyzer for their cloud/online services and a bridge with PC gaming (they own windows), Nintendo is profiting from it since most of their catalog (except for their 1st party) comes from PC ports

That's exactly Valve's strategy with the Steam Deck, they are capitalizing on it, and it seems to be a good idea, that's unfortunate for xbox, maybe for the next gen