In a general sense there is nothing wrong with missing estimates occasionally. I mean, part of what separates smart companies from less intelligent ones is the ability to anticipate future events, but even the best mess up sometimes.
The reason this oversight by Nintendo is particularly galling, however, is because of two factors:
1) Nintendo called it. In 2005, let alone 2006. It was one of the primary reasons they went with the Wii in the first place! "Hey guys," said Nintendo, "these development costs are getting way out of hand. Maybe we should slow it down and develop our systems more gradually." They were absolutely right. So why, if they could see the problems HD development could cause in 2005, could they not expect it in 2013?
2) Nintendo now has lots of empirical evidence in front of them to show them just how brutal the transition will be. Other companies may not have been as smart as Nintendo in 2005, but they didn't have a lot of examples to look to because HD development was still on the horizon, a thing of the future. By contrast, 2013 Nintendo had about 7 years of evidence to look back on -- to see the losses, to see the struggles, to see the closing studios -- which should have made it pretty clear what was going on.
So even if Nintendo somehow forgot their own wisdom from 2005, the painful 8 years for HD consoles between then and now surely should have reminded them. If you're heading up the plate without a helmet and you get hit on the head, that was pretty dumb, but perhaps you didn't think the pitcher you were facing was going to lose control. But if you go up to the plate without a helmet and also you already know the last 2 guys that came to the plate were hit right in the head, then you aren't just dumb, you're really dumb.