After seeing the Mii character creator, I must say this concept would be the best concept ever.
The first company that uses the Mii models for characters in a first person shooter of any kind, wins my money.
Imagine being able to create your character and play online. Guns can float in people hands like Tennis racks do...and the best part is everyone will know who they are.
But the idea becomes bigger than that. Say you created 25-100 Mii characters on your system. They can actually pull those characters into the single player game as villians and such. So walking around you happen to be surprised that the boss of level one is you Mom!!! OOPS, I guess you should have done your homework.
If Nintendo wanted to do this game, they wouldn't have to make it violent. It could be backyard war, or Backyard paintball.
Better yet, remember my idea about the FPS in the Nintendo universe, these graphics although simple, would work in a colorful action shooter like that. And would bring you further into the game.
Who is with me on this one?