I bet you the DS game in a case like that would be more expensive to produce though.
Maybe. Nintendo generally doesn't spend a whole lot on development which works incredibly well for them. Spend a little, make a lot. Nintendo could easily make New Super Mario Bros. 2, for example, for WiiWare. They'd probably make more money on DS, but you're right, the Wii would benefit far more from something like that.
I don't think memory is an issue either. Super Mario 64 was what, 16MB? Ocarina of Time was 32MB. People gave Nintendo crap for using cartridges, but if you ask me, they did a lot with what they had. I think the same principle applies here. 512MB isn't a lot of space, you could fit some decent sized game on there (even with a 64MB limit). On top of that, if you look hard enough, you can get SD cards cheap. I got a 2GB card for $20.
I'm hoping for great things on WiiWare and I think there's tons of potential here, if devs are willing to put forth the effort. What I'm really looking forward to is a return to a time when gameplay was the most important part of a game. That's really what's going to sell these games because there isn't enough room to fit tons of voice acting or CGI. Again, I look back to the N64 when developers (well, mostly Nintendo themselves and Rare) did a lot with a little.