First, I am not a Nintendo Fanatic, and second, my last Nintendo System was N64 (Nintendo 64).
I don't think the problem is the company, the systems or the games that it offers. I strongly believe that the problem resides within the customer who is not sure of what he really wants, and I refer to this statement:
because you have real video games
In my humble opinion, saying that means that for him there are different types of games, say "real" and "no-real", which is completely BS in all honesty.
Nintendo has always been family-casual oriented, hell just look at the name of the very first system "Famicom" (Family Computer). It says by itself.
Your brother simply wants other kind of games that unfortunately Nintendo does not offer, but that does not mean Nintendo systems or games catalogue are bad, not by a long shot.
Although Nintendo may be in trouble because their systems are not offering more technological power, say like Microsoft or Sony, still offers a very high quality games, which the other systems can't really say or be proud of, such as GT PlayStatino Store openning from an Xbox. That was the first example that came to my mind. Of course Nintendo games have bugs, but their quantity and impact is very very tiny compared to the ones from Microsft and Sony.
The last time I checked some statistics Nintendo was still leading the market with its systems, don't know how it is by now, but I don't think that will make Nintendo tremble. Of course this is just my opinion and I can be totally wrong, so take it with a grain of salt.