My friends and I initially enjoyed making Miis of ourselves. The person making the Mii was not allowed to design themselves, thus resulting in more "honest" depictions. If the game asks you to play as yourself, might as well use the Miis. Though I didn't like them appearing in games beyond the Wii Series. Like they show up Mario Kart? Okay, so that ruins the whole fantasy of the Mario world. Mario and the Mushroom Kingdom are just some product if myself and my friends are going to suddenly insert themselves in. Now Nintendo has them farting around in NSMB U. How is such a thing explained in terms of story? Well I guess it doesn't and instead of this being this rather simplistic tale of a plumber rescuing the Princess from a dragon-like monster I'm just doing some obstacle course in a videogame. If you're going to put the Miis in there why am I even playing as Mario? Clearly this is "just a game" now.
I don't think Nintendo has even thought this through much. It's probably just "well the Miis are popular so let's just throw them in." I figure they'll show up in a Zelda trailer at a future E3, cause tons of backlash, and Nintendo will be completely blindsided by it. I don't think that realize that to their fans, their franchises mean more than just some mindless entertainment for a rainy weekend.