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Mario isn't worn out, the games are still enjoyable. The only thing I don't like about new Mario games is the difficultly. They are so obviously designed to be casual and not at all tough. Compared to Super Mario World and Super Mario Bros 3, New Super Mario Bros is a walk in the park.
At least Super Mario 3D Land was really tough at the end.
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Mario itself is a good franchise. I've only played the NSMB DS game, and it was reasonably good. Didn't get any other version though since they're all relatively similar and can't compare to SMB3.
Galaxy 1 and Galaxy 2 are fantastic games. The difficulty works well, since the first few stars are easy, but the comets and green stars make it a lot trickier.
The main issue for nintendo of recent times is the gravitation towards social networking, DLC and multiplayer. Nintendo has very little history with this, and so will have to work extra hard to turn their singleplayer franchises into social games. Or a Galaxy spin-off with a level builder perhaps.