Actually, as the producer, maybe his deadline interests are on the other side.
I don't think this is Nintendo's biggest blunder for the simple reason that Nintendo already faltered back on the N64, which had some of the greatest games ever made. I have been somewhat dissappointed in the quality of Nintendo's latest games, and I think it's somewhat related to Miyamoto's position changing, but I think there are other factors too.
I think Nintendo is beginning to recognize that quantity matters more than quality these days. Nintendo saved the industry from a crash by bringing quality games to the table back in the 80s, but N64 showed that you can have the very best games in the world, and it won't matter if your competitor has three times as many games. You can't cover the genres, invent new hits, and fill niche needs without quantity. So it's not just Miyamoto switching positions, I think it's Nintendo trying to provide quantity.
This is a big blunder for fans, I suppose you could argue it was Nintendo's biggest mistake for us, but for Nintendo as a business, these changes are necessary. As others pointed out, Miyamoto is not going to be around forever, now is the time to start raising new stars rather than waiting until Miyamoto is retired! From this position, he can supervise many different games. Also, releasing a larger quantity of games is working for Nintendo. DS has had a much larger first party game lineup than Gameboy did, and the result is that Nintendo was able to defeat the biggest competitor it has faced in the handheld gaming market. Not only that, but it's bringing new gamers into the market in general.