They're not going to support the old game when they have a game on a platform that's still selling (specifically Smash 3DS now).
As others said, Melee HD would simply cause controversy because they would inevitably remove wavedashing (at the very least of any gameplay changes), not to mention any balancing for HDMI that would cause the CRT-toting crowd to grumble.
I can't even begin to describe how frustrating these topics can be on Neogaf. This post is so clueless it's astounding.
Let's be clear: Within a reasonable margin of error, it's safe to say that the ENTIRE competitive Melee community wants Melee ported to Switch. They also wanted it ported to Wii U. They just want it on new consoles in a digital format so new people can play without tracking down old, outdated hardware and overpaying for a physical copy of the game. We aren't attached to our CRTs other than the sense of pride that we're all crazy enough to deal with they horrible machines because we love and care about the game so much.
If Nintendo decided to do help the scene with just a simple Virtual Console release, all of the competitive players would be happy. This means that Nintendo literally wouldn't have to do anything but build a Gamecube emulator and load Melee onto it. Considering Melee was the best selling Gamecube title by far and still has an incredibly active community, it's safe to say that Melee alone would recoup the cost of making that emulator: if not, I'm sure Nintendo would make it back by re-releasing other GCN titles.
This means Nintendo doesn't have to change ANYTHING. We're literally making it as easy for them as possible; if you're emulator is good, then all is well in the world. If they choose to upres it, add a PAL/NTSC switch, add online play, etc. that would be greatly appreciated, but it's not necessary. Additionally, no one is asking for gameplay changes, they have zero reason to do so, and even if they did make some, it makes literally no sense and shows a clear misunderstanding of the game mechanics to think they would or even could "take out wavedashing." They absolutely could rebalance some characters; hell, if they're really crazy they could even add a few. But they can't take out movement systems without breaking the entire game; not just from a competitive perspective, but in general. Nintendo doesn't need to, wouldn't want to, and has no real means to remove the parts of the game that make Melee competitive. Those facets are much more integral to the game systems than many here seem to believe.
This idea of Melee fans being super picky and that there's really any reasonable chance of them rejecting a Melee port is ridiculous. And a port alone could do wonders for Melee'ss scene, while selling well. It's an arrangement that could make all parties happy.
If Reggie doesn't want to set up a league, that's fine and, honestly, it makes sense. I don't think anyone is really all that upset about that either, because realistically we've all seen Nintendo's tournaments and, while fun, they aren't really conducive to top-level play. But not having a Melee HD (short hand for any modern way of playing Melee) is astounding, and I wonder if misunderstandings like the ones we see in this thread are a reason why we haven't seen it by now.
Edit: And, to the point of Hungrybox's original point: I think part of the frustration actually does come from the types of tournaments they have at E3. Those are cool and fun and a great way for Nintendo to help introduce people to competitive gaming while also selling their games: they're honestly great marketing tools for both the game and the scene. However, you can look at the three tournaments they had this week and see Smash everywhere. Invited players, organizers, commentators, production, and more. Everytime they want to do something like this they look to the established Smash scene for help. And that's great! But it starts to feel a little dirty when they use our enthusiasm and love for Nintendo (because most Smash fans are also huge Nintendo fans, and are also huge contributors to their other eSports scenes) when it's convenient to them, but then ignore it the rest of the year. I know they're a business, and in a way our excitement for their products is really only a means to get our money, but it's kind of shitty to then also use that enthusiasm to further market their games and make more money off of others without giving us anything in return. And that doesn't have to be money. They tweeted this today:
https://twitter.com/NintendoVS/status/875839776091324416 and you can see the replies are full of people just saying "Thank you."
That level of support has only ever seen appreciation from smashers in my experience, and it takes such little effort on their part. They've brought booths with game demos to a couple of tournaments in the past as well, and that's always well received as well.
It really just does everyone well to keep Smash and Nintendo on good terms with each other, and it takes such little effort from Nintendo to make it happen. I don't know why, outside of Bill Trinen and JC (who I love) they seem so scared to acknowledge the scene at all.
Also, one last thing: In terms of sales, obviously a port of Melee would sell well on Switch. But I see a lot of people talk about how it would cannibalize a Smash 5's sales (which is ridiculous to me, as we don't apply this same argument to any other franchises on the virtual console). If this were true, than all it takes is spacing them out. If they released Melee HD this year, and then the Smash 4 port next year, then all problems are alleviated. I think this is part of the reason why we're seeing people like Hungrybox get a little more aggressive about expansion right now. Some people think that if we're going to get Melee HD, now's our best chance.