I never cared that Nintendo did this sort of thing... why would I? Technology advances very fast, and over the lifespan of a console/handheld a lot of improvements can be made. Nintendo isn't the only one to do this, even the PS1 and PS2 released various iterations with improvements to size and such.
The reason I don't care is because I don't need to buy them. I don't get any sort of benefit except convenience for buying the them. I held off and waited and got the 3DS because I liked the improvements it had over the older iterations... but if I had an older 3DS I wouldn't have felt it necessary to buy the 3DS.
However, them introducing another analog stick and exclusive games is a bit of a **** move. They launched the 3DS probably knowing that one analog stick was going to be problematic, yet here we are... practically forced to buy the newest version or miss out on some exclusive titles. At least with advances like the GBC it was advancement in technology... whereas this isn't a change due to advanced technology but merely poor decisions.
I love Nintendo, but this is a really bad decision. I'm not buying another 3DS, and if I miss out on some good titles I'm going to be pissed.
TL:DR; New hardware introduced because of better technology(GBC, smaller/slimmer consoles, bigger screens on handhelds) is absolutely okay in my opinion. New hardware introduced because of poor foresight is really, really bad. They ****ed up by not having a second analog stick/more buttons. They should have anticipated that playing certain games/genres without it would be problematic... but instead they launched the 3DS without it. Don't punish your consumers because of it.