Nintendo is mostly renowned world-wide for their first-party titles, so if they did drop out of the console business, I would be stung rather deeply for the sake of being a doting Nintendo fan, but it wouldn't be too much of a loss. I wouldn't expect them to stop making handhelds though, but on the slight off-chance that they did, I guess doing a SEGA would be the best move; they have the game dev mojo. So long as they continue developing games, hopefully with the PC as their main platform, they'd be well off. I personally believe that neither Sony or Microsoft, would do them justice. But for mainstream gaming, I would fall back on Sony consoles.
If Sony dropped out of the console business, then they're practically dead in the water on the gaming front. They generate next to nothing when it comes to first-party titles of their own, so they have almost nothing to fall back on. When it all comes down to it, Sony's strongest point in gaming is their hardware. As third-party devs, Nintendo would surely conquer them on that front. I can only see Sony getting bought or possibly absorbed/merged with, if this whole scenario were to happen.
As for Microsoft, well, seeing as hardware is pretty much all they have, and most of the Xbox's top games aren't console exclusives, save for Halo, then them dropping out of the console business really wouldn't affect me, or anyone. If Microsoft quit the gaming business today, I wouldn't flinch a millimetre.


