I think it just needs to be looked at as making products that appeal to the broadest range of people and including whatever other extras are practical within those considerations to appeal to more of a niche audience like dedicated classic gamers. Targeting the dedicated classic gamer reaches a point of diminishing returns where you can't possibly accommodate every need/desire/requirement since you won't sell enough extra units - and the main target audience won't care - to justify whatever extra might be involved to get it there. From a behind-the-scenes standpoint I can say there are tremendous demands and considerations from licensors, retailers, production, etc., all with very specific timetables. That all works against products like these.
The home arcade machine will be a chance to work with fewer such restrictions since that's going to be at a much higher price point. That product will naturally have, and should have, much higher expectations than something selling for $20 or less.
I find it interesting that retailers make demands on products like these. What kinds of input do they provide? Seems like they would either want it or not based on past sales and price points. Do they really drill down into specifics of the product itself?
Must be a nightmare with all the different products a retailer like Walmart or Target sells.