While it'll inevitably be an unpopular move to consumers, and the media will spin it badly against Nintendo, consumers don't understand how copyright (and Nintendo's actions) actually has value for them long-term.

I definitely support creative commons, public domain, increased consumer rights, and shorter copyright spans, and copyright law definitely needs to be overhauled, because it's gone too overboard in corporate benefit; but copyright as a concept actually is a balanced benefit for both consumers and creators, and all the ire that'll be thrown Nintendo's way is quite the ball of wax; pretty much whatever Nintendo did - including doing nothing - would've harmed them in some way.

It reminds me of the YouTube Let's Play kerfuffle awhile back, where Google asked Nintendo if they wanted free money for doing nothing, Nintendo said yes, and the internet mobs came to stone Nintendo because the money was a partial cut of the advertising money Let's Players made from playing Nintendo games. In an ideal copyright system, that kind of thing would already be covered so fans would have that freedom already, but still, the thoughtless rage of the masses (spurred on by the understandable but obviously biased anger of the people who'd be making less money) was amusing to watch. Nintendo's bad PR team didn't do them any favor.

Similar situation with Steam paid-mods and Bethesda.

Steam: "Do you want money?"

Bethesda: "Sure do!"

Steam: "How big of a cut would you like?"

Bethesda: "As big as possible! How big can we have!?"

Internet: "Let's kill them and eat their livers."

The messaging on these kinds of situations need to be carefully handled, because, on average, most consumers only see the short-term loss.

Nintendo has always vigorously defended their IP. Most projects get C&D orders soon after they make themselves known publicly.

Good reminder: Don't use Nintendo's IP. It is only a matter of time before the legal demands will come.

Be like Carmack and Romero - build a knock-off that uses all the same mechanics, but original art and story.

Absolutely! And set your goal to not just clone the game with a different skin, but to take the genre farther and make it better.

Ideally, it wouldn't even be recognizable as a knock-off, but if it is recognizable, you want your players to tell their friends, "It's like X, but even better!"

These graphics point is an interesting one. Where we have been happy with the Spellforce 1 look when it launched and maybe 10 years go today most 'gamer guys' drop a game when it looks some kind of non HD in the start menu without knowing the gameplay or anything else. 'I wont play it if it dont look realistic' is just what happens to the people playing Battelfield or Call of Duty.

Im sad about this because the fact that even publishers have got to this kind of rail too. Gameplay dosent matter today essentialy the graphics looks neat. And the trend is also seen on game fairs where instead of playable demos Sony has shown Films of games that are in production (shown the same film two years a follow). I think we need go back to take less advantage of squelching the last pixel out of every (U)HD grafics but back to good and long gameplay, but thats only my opinion.

On the Nintendo point my opninion is, yeah I understand both the company as same as the fans, that unless they want to share or sell it Nintendo could let them make there fan games. I have seen stupid ones but also very good ones that have had the look and feel of a real Nintendo published game so they could contact them and let them make something paid or even polish there made and publish it in Nintendo Store for a few bucks.

And before that question comes: yeah if I would have such a company I would do it like this