It’s no surprise that Nintendo starting working on the Wii U console way back in 2007 shortly after the Wii debuted. Gaming companies have a very long development cycle on new consoles and start working on the next big thing while the current big thing is hot. Nintendo has the most popular portable system around with the DS and apparently, the Wii U was considered to be fashioned into another portable console early on.
The revelation of the Wii U controller nearly being a standalone portable that worked with the base console comes by way of Nintendo president Satoru Iwata. He noted that the subject was discussed in round table talks early on. Ultimately, Nintendo decided that the Wii U should be a new and dedicated system with the controller packing the secondary screen as we have seen.
Iwata noted that the conclusion to the discussions decided that the controller would only show the images sent to it by the console. This would allow for better graphics, which is something that a battery wouldn’t have been able to do. Iwata also noted that early on Nintendo considered making the second screen a separate accessory from the controller. Depending on how expensive the Wii U controllers end up being, that screen accessory may have been a good idea. With normal Wii controllers at around $40, the Wii U offerings will be much more than that price.