The Switch isn't exactly the king of the video game console market though. The Switch is selling great, sure, but it is still lagging considerably behind the PS4 and Xbox 1. Another version of the Switch to appeal to a wider audience and try to bridge that gap makes a ton of sense. I don't have a Switch right now. Why? Because I have a PS4, and XB1, and a gaming PC. I don't need to dock a Switch on my TV. If a mainline Pokemon game wasn't coming out for it, I wouldn't even consider buying a full priced Switch at all. I would be very interested in a cheaper, mobile only version, however. I'm interested in also getting stuff like Mario, Zelda, and Smash Bros, but I'm not buying a full priced Switch to play those.
There are a lot of people in my boat as well. Unless every single video game consumer owns a Switch, there is still room to increase the Switch's reach. It is absolutely in Nintendo's best interest to reach as broad of an audience as possible. They want to get me in their ecosystem, paying their annual fees, buying games on their e-shop, etc. The earlier they can do that, the more money they make. Sony launched the PS4 Slim just less than 3 years after the launch of the PS4, as an example. And PS4 sales never exactly slipped. Since it's been over 2 years since the release of the Switch, hoping for/expecting an alternative version in the near future makes sense.