I don't think connectivity was a bad idea in itself, it didnt take off because you needed to have that cable to do it and it wasnt supported very well other then a few games. Also, at that E3, that seemed to be what Nintendo where most proud to show off, which looked kind of stupid compared to Sony and Microsoft showing off online games.
However, downloading DS demo's off the Wii is actually awesome and I think some interesting things could be done with Wii/DS connectivity