I wasn't looking for a full debate just bringing up ideas but ok:
I think it's NICE Nintendo allowed counterfeit games to be used; they only bricked online. They could brick games but decided not to do so. I'd like to know why because they obviously thought about the matter for a long time.
The PAID game remained (although not legit) and the PAID system remains; only the PAID online service agreement ended and likely a prorated refund would happen. They don't even have to provide free updates (you show me any law that requires support.) Purchased online games you can't download would get a refund since the law is pretty easy on that.
I am not in support of a total online ban; however, I can understand the policy behind doing so. I can see updates/downloads being allowed but online play for that game being banned... although Nintendo suffered a massive hack to their store that allows free game download (update/restore) which still works AFTER they shutdown those old system's online stores.
I don't know their new system; however, my guess would be digitally signed code with a unique ID integrated in that. If somebody modifies and exploits the scheme it could be made quite difficult to generate valid signature for code that has been hacked and if/when they do this they'd be using the same unique ID for each copy of the exploit. Assuming the whole thing doesn't break and they can sign anything or the signature isn't made irrelevant. This would then make any duplicates a possible threat which maybe you only worry about after X copies show up. Maybe this online store has already been hacked and patched?
I would hope their online system is immune from anything client software does. Don't just assume competent security from a locked down tiny proprietary ecosystem with static hardware and possibly a secured client only server. They had two really pathetic encryption passwords for the gamecube and wii.
It's true piracy doesn't kill off everything but it always depended upon difficulty to minimize the harm. SEGA got out of the console business. they had a huge piracy problem that contributed to other problems at the time. The lost income is quantified and amortized which likely goes into pricing or at least impacts profits which influences capital investment (where appearance matters.) This is not the past either, everybody is competing for our TIME - the impact of too much content is already here without piracy.
US law: "guilty until proven innocent" is an illogical precept for the legal system with cogent backing but it does not apply to private parties and even less when you have legal print in the user agreement. You may get some common sense relief if you can afford to go to court and they allow you to win without just breaking you in the system; which could also rule in their favor. They can just screw you over without providing you anything to grasp at for legal footing. If you pay, it doesn't make much difference other than some kind of partial refund may come your way.