Allegedly, in what is quickly becoming a pissing match of almost biblical proportions, Nintendo blocked the title’s move over to Xbox Live Arcade, regardless of the fact that accepting the deal would have also allowed Rare to publish Goldeneye and other Rare developed titles to be named later on the Virtual Console. Nintendo President Satoru Iwata himself was rumored to be in on the negotiations (or lack thereof, for that matter). Also keep in mind this is all heresay from Microsoft sources.
If this story is true, you can whine all you want about how Nintendo is being a stubborn ass, because bottom line is this is all a business, and these companies are competitors. Nintendo saw a way to keep its edge this generation, and it took it. Besides, when Brawl hits next month this will all be a distant memory.