They own 1/3rd of Pokemon, but the games are made by game freak which also has 1/3. The final 1/3 is owned by creatures Inc which is a joint venture.

Nintendo doesn't make the games, they just publish them, game freak is responsible for the games.

IMO there are a few problems with how Pokemon is developed. First, they impose an intense release cycle with release dates that are inflexible. This is because Pokemon is a multi media experience with tons of merchandise and media that depends on the next generation coming out, and despite the games now needing a much larger scope, they have not slowed down the release cycle.

Second, they haven't really expanded their development staff since the DS days. It's not that they're cheap, it's that the director of the games prefers working with smaller teams and never adapted to building a larger team which is necessary for the bigger scope of the games.

I actually think the developers themselves are very talented as they're still putting out games with large scopes with a ridiculous release cycle and team size. I think their issue is mis-management, not talent.