When I purchase a piece of hardware, it is mine to do with as I wish.  This is a long-held understanding.  If I buy a piece of clothing, I can have it altered.  If I buy a car, I can change the tires.  If I buy a television, I can kill myself trying to screw with its insides.

It might void the warranty, it might put my life at risk or potentially damage the thing I've purchased, but it is my right as a consumer.

Nintendo takes a different view on the issue.  Owners of the Wii have long been able to employ a simple buffer overflow exploit in Twilight Princess to run custom code.  This exploit, called the Twilight Hack, allows a user to install, among other things, an application called the Homebrew Channel, which looks like any other Wii channel and lets you run other custom code without using the Twilight Hack again.  It's the gaming console equivalent of installing a new stereo in your car.

Since the hack was made public, Nintendo has been trying to thwart it.  They have, to date, released three firmware updates that included code targeted to stop the Twilight Hack.  The most recent update succeeded at stopping it completely - it appears to detect the hacked save files and delete them, both on boot and whenever you insert an SD card.

So, all of this is standard fare.  Whenever a console launches, homebrewers will make it run custom code.  The console manufacturer will release an update to prevent this.  The homebrewers will work around it.  This process will continue in an escalating cycle.

However, Nintendo has delivered a low blow here.  Along with the System Menu 3.4 update, they changed their terms of service.

We may without notifying you, download updates, patches, upgrades and similar software to your Wii Console and may disable unauthorized or illegal software placed on your Wii Console...

Now, that's pretty cold - deleting our custom software?  Come on Nintendo, all I want to do is play videos on my Wii!  Also, the first time a fully automated background firmware update breaks something, the angry calls are going to pour like rain.  Power outage in the middle of a night-time firmware update?  Too bad!  But it gets worse...
If we detect unauthorized software, services, or devices, your access to the Wii Network Service may be disabled and/or the Wii Console or games may be unplayable.

Okay, at this point I feel it is crucial to point out a couple of things.  First, these quotes come from two documents, the Wii Network Service Privacy Policy and the Wii Network Service EULA.  Both of these documents are required, not to use the Wii in general, but to use the Wiiconnect24 services (the Shop channel, Nintendo channel, and Nintendo's other online content channels).  So, to use their network, you agree that they may disable your system completely.  This means two things:

1. You can perfectly legally run hacked code on a Wii that does not use Wiiconnect24.

2. You grant Nintendo the right to break the law (destruction of private property) if you choose to use the Wiiconnect24 service.

Now, according to a lawyer I know, a contract cannot override criminal law, even if signed in full knowledge as opposed to clicked-through (the enforceability of click-through EULAs is still up for debate in the US).  So this clause is, by necessity, unenforceable.

So why is it there?  Nintendo has a juggernaut legal team, famed for its ruthlessness.  They can bankrupt any individual consumer with the legal proceedings necessary to challenge them, and it is unlikely that this will raise enough stink to get a class-action suit started.

I used to have some respect for Nintendo.