Is 3DS being marketed poorly?

Here's a quiz for you. Is the 3DS:
A. An entirely new software platform or
B. A DS that can play games in 3D

I only bring this up because this weekend I for the third time got into a conversation with someone who misunderstood what is a 3DS. The individuals in question were casual gamers and parents, who of course make up the largest consumer base for the device, so it's extremely important to Nintendo that they get it. But I've heard this enough times now that I'm going to refrain from calling my friends and coworkers idiots and pin this one on the N of America marketing department.

Is this a 3DS?...

In this 21st century and age, electronics consumers have gleefully fallen victim to incessant insignificant tech upgrades, with a new letter and number being added to every product name every year. This has impacted brand loyalty - maybe it's just because I'm an adult now, but doesn't it seem like people are less virulently Apple vs. Microsoft/Google/The World? - and mixed in compulsive dedication to owning the newest devices. Because god forbid that that phone you treated like a precious diamond in March actually be worth keeping for a year. 

Getting off topic.

"GET OVER HERE!" - Topic, 1 second ago

The point is that Nintendo has been edging toward this trend with its handheld devices - understandable, as they share market space with iPhOnEs and Droidbots and tablets. They've kinda been doing it for years - look at Game Boy Color and Color Game Boy (not a joke, they are very different). More recently, the DS had four revisions: 

the DS in 2004, 

the DS Lite in 2006, renewing the form factor,

the DSi in 2008, adding... I dunno something,

the DSi XL in 2010, increasing the screen area.

Shortly after the last of those, 

the 3DS came out in 2011 adding 3D (and also a whole new software library)

the 3DS XL in 2012 seems largely (EXTRA largely (sigh)) to have replaced it in stores..

...or is this one?

I listed them like that for a reason. Look how, were I Biff "Average" Consumer, I might not be able to tell the difference between the Lite to DSi gap, and the DSi to 3DS gap? As of 2010, four DS models existed and they all played the same games. [the following is the misunderstanding I've heard repeatedly]: Why do I need to upgrade again now in 2012? Oh, the new one has 3D and can play some of the old DS games in 3D, which the old DS can't. But... I don't really give a shit about 3D. I think I'll pass.

Then two years from now, these same people are going to be baffled why there aren't any new games for their DS, and how come Best Buy and Target don't sell any non-3D games? They don't realize that this was a generational leap, the same as PS2 to PS3, because Nintendo is spending so much time explaining "it can still play your old games!" Regular DS games are no longer being made, and the old device will soon be obsolete. 3DS has been marketed as "DS with 3D! and also a whole new software library", rather than what it should be, "DS with a whole new software library! and also 3D". Because whether you're looking at the incremental life-cycle of obsessive geek-turd phonelets or the stable as-of-six-years-ago console race, the idea of needing to buy a new platform for an entirely new generation of software is vanishing.

I expect the Wii U is going to encounter this issue as well, and hopefully Nintendo does a better job of distinguishing it as a complete hardware overhaul with its own brand new software library. Um, I say I hope, but they haven't, and it's going to be out in a few weeks. It's already going to be a hell of a time getting consumers who feel like they got burned on Wii ("it was fun for two weeks", "collecting dust") to come back for another round, without even touching the fact that the mainstream gaming press has seemingly already determined the platform's damnation. The 3DS may have bounced back, but the DS brand was in better standing than the Wii is now.

Oh well. Nintendo are morons at business. And I say that knowing full well that the company is run by people with more money in their pockets than I will ever see in my life. They just aren't gonna be in it for the long haul if they keep making stupid decisions; when your only strength is as a software company, how do you keep hardware afloat?