The problem with your logic is that you pretend it's either or. I will play a fun game with good graphics more than a fun game with OK graphics, especially on my 65" TV. Also, you're not typical - most people have gotten bored with their Wii.
I didn't say that I don't want gameplay AND graphics. But, If I have to make a choice, I choose gameplay. It seems too many games (and the consumers, I guess) choose graphics. But, If most people are bored with their wii, they still sell an awful lot of games. I have not played every game, but I find the wii games much more fun than the 360. But like I said, I am not a hard core gamer.
I for one would love to see a Wii with 1080p output and a better web browser. Although really even upconverting to 720p would be a substantial improvement; right now you have to buy an additional cable just to get it all the way up to 480p.
Anyone can make an omelet with eggs. The trick is to make one with none.