A Wii is still like $90. This is $60 and is much closer to impulse buy/stocking stuffer territory. Plus it's going to have a dead simple UI, looks like a NES and comes with classic style controllers. You plug it in, turn it on and game. No accounts to set up and fiddle with.
I agree that it should be even cheaper then $60, but don't underestimate how much of a difference the pricing here will make to the target buyer.