The Xbox 360 has been having supply problems this year, and it doesn't sell nearly as well as the Wii.
You might be able to "create demand" on a small scale, but I think when you hit the "tens of millions" scale, that argument gets a bit silly. They can build more factories, but that takes time and money, and the only thing worse than under-production is over-production. Don't forget that they also have to produce about 500,000 DS units per month. On top of all that they have to create new production lines to get ready for the Wii Lite we'll all be buying in the next year or two.