Supporting his argument is one of his best examples of shovelware gone right: D3 Publisher's Simple series. D3 admits in the very packaging that their games are cheap, with the implication that you shouldn't expect much. People buy them expecting flawed experiences, and can then ignore the technical issues. Simple games allow games by new developers with small budgets to share shelf space with AAA games. And if people don't want that, they know not to pick up the game.
People can spot a crap game, Kohler says, and know to avoid it. Nobody's going to be fooled into thinking a Data Design Interactive game is high-quality. Kohler likens it to knockoff He-Man toys or bargain-bin DVDs in Walgreens: people can tell the difference, and these things don't deter sales of real products at all. What they offer is a cheap, occasionally novel choice, and more choice is always better. If a "shovelware" game is at least a little bit fun, then it's good that it exists.
The final point he makes, which is something we hadn't considered: allowing garbage on the system is a message that Nintendo isn't so closely restricting content for the Wii. This could translate into AO-rated games in the future, or (we think) wildly experimental games.