I think, broadly, it'll have A year better than Nintendo Switch's best year. Maybe launch year, maybe the year after, but unless Nintendo flubs it in some sense, NG Switch should have all the market appeal of Nintendo Switch PLUS the market appeal of a modern home console, as long as they have third parties on board at least trying to treat it as an equal.
I think the Nintendo Switch business is healthy, and so too is the brand. NG Switch will benefit from this. As long as Nintendo makes new games people want, and as long as people are engaged with existing games, you have a baseline of sales from people replacing and upgrading. Then you have the additional power allowing for broader third party support, you have every COD, and it's a handheld, and now you genuinely have the eye of a lot of hardcore players. People buying a Switch for the first time will get a NG Switch, people replacing or getting back into Nintendo or Switch will buy a NG Switch, people who want to play "hardcore games" on the go will buy a NG Switch. It's like an appliance in the minds of a lot of consumers, and you replace your appliances every few years, and that's normal.
I don't think PC handhelds are materially relevant to Nintendo's success or market penetration. It's a genuinely different beast, and a lot of hardcore gamers are people who play only on console for various reasons, such as myself, or people with a PC who are tempted into a new device not only by formfactor but by games they will never officially get on PC. Nintendo is the only first party publisher providing such assurances at present. I think the trend I've seen online and among my friends of PC gamers getting a Switch as their secondary machine will continue.
What NG Switch could do if Nintendo plays every card right, has the right branding, the right price, the right games ready, the right node, the right design, and the right third party games, is become the default. Why spend $500 on a 4K home console for EA Sports FC, Call of Duty, and GTA, when you could spend $400-450 on a 4K hybrid console, that has all those games, plus it's a handheld, plus it has tabletop mode, plus it comes with two controllers, plus it has Mario Kart, and Super Smash Bros., and since it's backwards compatible, it either plays dozens of games you already have, or opens up a huge backlog of games you missed the last couple years.
It's a big set of IFs! But if the answers are YES, then it becomes the most obvious choice. Most consumers don't care that it's reconstructed 4K or the image quality is degraded or the draw distance is a third closer to the camera, they care that it can play the games they want and looks good on the TV set they own.