I don't really get the Rare/Retro comparisons.
I think it's because Rare was Nintendo's major non-Japanese studio and Retro kind of filled those shoes. The major difference is that Retro Studios releases one new game every two to three years while Rare contributed more. Retro's games tend to receive wider acclaim so really it's quality vs quantity.
I never really got into Rare's titles. I liked Conker's Bad Fur Day a lot, but other than that, I only found them to be okay. They did help round out Nintendo's lineup. I think Retro's philosophy more closer matches Nintendo's which makes sense considering they're first party.
I think it would greatly benefit Nintendo to open new studios around the US. One in New York, one in California, then just officially make Monster Games and Next Level Games second or first party if (and only if) they're willing.