After the switch lite there is no reason to split the modes. The public has spoken and they want a system that can do both. A docked only mode is a colossal waste of everything
Have I been magically transported to an alternate dimension where the Lite was some kind of crazy failure? It's sold around 18 million units so far, which is already more than the 2DS and 2DS XL combined (which would be the closest comparable devices), and it will have comfortably outsold several of Nintendo's entire consoles by the time all is said and done. Would people only have counted it as a success if it just straight-up outside the main model?
Yes, I wouldn't expect a home-only console to sell better than a hybrid, all other things being equal. But, I also wouldn't expect a highly-priced "pro" model to sell that much better, either. Neither Sony nor MS have reported PS4 Pro or XBO X sales, but what sales figures from Japan show
the PS4 Pro accounted for just over 17% of all PS4 sales in the country by the time PS5 had launched. Even if it was higher in other regions, that still puts PS4 Pro sales at maybe between 20-25 million, and Xbox One X sales certainly well below that. The Switch Lite, incidentally, has almost certainly already outsold the One X, and will probably end up outselling the PS4 Pro too.
This is why I'm talking about crazier strategies like releasing a more powerful home console first, then following up with a hybrid to match. We've got a chip that's too powerful for a "pro" console, but arguably too early for a Switch 2, and much bigger (and therefore potentially expensive and power-hungry) than we would have expected for either. We've also got consistent reports of the device launching late this year or early next year, and the leaks seem to contain a pretty complete set of drivers for the device. Things don't really line up cleanly for a straight-up Switch 2 or Switch Pro as I see it, so it's worth considering what more unusual plans Nintendo might have.
I've seen a few people suggest that Nintendo release Drake in a more expensive "pro" style model at anywhere up to $500, and then in a couple of years bring the price down and effectively replace the current Switch, but I don't think the audience for that is necessarily hugely more than a $300 ~3.7TF home console version. In both cases they're likely selling primarily to existing owners, in any case.
And again, I don't actually expect this, I'm very much expecting some kind of hybrid system, but I do think it's interesting to consider the alternatives.
I'd say it makes the marketing a lot harder. You want it to be a complementary premium device to the old generation, until it becomes a cut-down version of the new generation. That's completely reversing the positioning of the hardware.
Then they have to minimize the damage made to their main product appeal, which isn't the best way to play Nintendo games anymore, and to the next generation, which will have 2 years old specs rather than being hyped over.
And that's not mention smaller issues like the Home not having new controller features.
I don't think it's a big issue in terms of positioning, it's just a separate product line, and it doesn't have to be positioned as a "cut-down" version of the Switch 2, just an alternative option. Gaming hardware (and electronics of all kinds) often transition between being high-end to being a budget model in any case; the PS4 was cutting edge technology when it was launched, but is the cheaper model now. If there's any kind of cross-gen period, then Nintendo will already have to have clear markings on what hardware a given game runs on (they actually already do with the Lite, with both labelling on boxes, and warnings if you try to buy software like 1-2 Switch on the Switch Lite eShop), so the Switch Home would be included in that.
Regarding hardware, I don't see Switch 2 being "2 year old specs" being an issue. Firstly, because it's two year old console specs in a hybrid (do you think that people would give out if MS launched a device in the Switch form-factor later this year that had a die-shrunk XBSS chip in it?), but also because Nintendo isn't going to reveal the specs to either device anyway. Not that most Nintendo console owners care that much about having the latest specs in any case, as if they did they probably wouldn't be buying Nintendo consoles.
If there are new controller features on Switch 2, then yeah there's a break in compatibility there, but we already have a similar situation with Switch Lite. It would only be an issue if Nintendo made a big push for some new kind of interface or paradigm for the Switch 2, but this theory is really just assuming a very straight-forward successor to the Switch. Otherwise they'd really need more of a clean break.