in this current economic situation, when people don't want to spend a ton of money on anything. And they are looking for entertainment and don't want to invest in an entertainment center, they will go with the Wii, like they have been for 2 years now. It is in direct competition with the PS3. Nobody but highend audio and video freaks care about Blu-ray, when people look at buying the PS3 as compared to the other system its based upon games and whom they can play those games with. Thats why the 360 is destroying it and thats why the Wii is destroying both of them.
Denying the wii is in competition with them is just a way for someone to feel better about their purchase. I know many people that wanted a PS3 but didn't want to pay that much and went with a Wii instead, or a Wii-360 combo.