That's not the problem and that product is not the solution to the problem. The problem is as another user was getting at is that you can not seamlessly go into portable mode while playing a game of an external USB. This is actually impossible to solve.
Many people probably would not mind this drawback and Nintendo should just give you the option. Despite what another user said about Nintendo not giving any options to users, they have actually given the most options in terms of storage.
I also don't agree with people saying anything about save games is part of the problem why they don't have support for externals. Saving always has a warning not to power down during it and one line of text for undocking solves that issue.
I definitely think it's a combination of the two. The problem is
1) What happens when you undock when playing a game from USB?
2) What happens when you resume a game that was playing from a USB?
I would disagree about saving not being a part of those two issues. You can have a simple warning message at start that says "This is running off the USB, don't undock during play!" or something, and that might feel like you've solved it, but as a user that just creates a whole new issue. Then you've got to remember which games are on the USB drive and which games are on the SD card; which games you can safely undock, and which games you need to make sure you save and shut down.
That quickly turns undocking the Switch from "Hey, this is a neat thing that works 100% of the time" to "Shit, I wanna go to bed, is this game on the USB? Did it pop up a warning message when I started playing 3 hours ago? I just tapped A when started the game, maybe I just missed it? Is it safe to undock? Oh yeah, this game I bought when I was on the couch, so it must've downloaded to the SD card, so this one is safe to undock."
I can definitely see why some people want a USB drive, but for many users I think that would actively damage the overall experience by causing switching from console to handheld mode to change from something that seamlessly works 100% of the time for all games, to something that works most of the time but does not work at all for games that installed to a USB drive. Keeping track of install locations is just a complication that ruins the messaging of "Dock it, undock it, it works seamlessly in any scenario."
Especially during the console's early lifetime, Nintendo should not want users to ever feel at all concerned that it might not be safe to undock the device. That would be a massive failure for their entire messaging of the console, and cause long-term damage to the perception of the console.
Would love a hdd at the dock with a sd card to go. Although do we have an idea of typical game sizes? I think no, so the HDD may be necessary.
Zelda is ~13GB (I think 13.4 but don't remember the exact number). I imagine most larger AAA games will be of a similar size, and jrpg's/indie games will be much smaller.