The issue, as others have pointed out, is that the console and the games are perceived to be part of the "official" package by the general public. If you were permitted to market any game on their console, it could effect the overall perception of the brand in the marketplace; particularly if the public is confused about what is and what is not an officially sanctioned product.
For example, suppose that someone produced an M-rated game with adult content for the Nintendo Wii console and marketed the game as "Wii Wanker". Wouldn't that harm the family-friendly image that Nintendo has so carefully cultivated and protected? If it does, shouldn't Nintendo at the very least be compensated for you harming their brand?
I agree that one should be able to do what one wishes with one's own console, but there has to be some line drawn at marketing arbitrary games for a console brand owned by another. Nintendo has decided that it is cheaper to do this with some level of technical enforcement and legal action rather than through legal action alone. I can certainly understand where Nintendo is coming from on this one.
Theres no "marketing" involved with flashcarts, in no way are they ever portrayed as an officially sanctioned product, nor do they even sell their products in retail stores that sell official games Peoples perception of them as official products is not the responsibility of the flashcart manufacturer, unless they encourage that rumor, which they don't. In fact they usually go out of their way to state that they are not Official Products. (The outside box has a notice saying its not official, then a slip of paper in the box says it, the label of the flashcart itself, etc etc. as for "wii wanker", that's a different story, that's direct trademark infringement. But just an adult homebrew game would be fine and shouldn't get any legal action against them because that's not breaking any laws.