Re-releasing a GCN game is easier said than done. They'd be better suited to HD Remaster it or fully remake it considering aspects of the game have not aged well. That requires years of development, resources, and such. Who is to say they haven't explored that path?
Games get re-released all the time and somehow, other companies manage. Personally, I don't much care how they get re-released (I'm fine with remasters or direct emulations) but it's a shame so many of their games are locked behind hardware.
But let's forget about Mario Sunshine.
Why not re-release the Mario Galaxy games? They were already ported to the Wii U and unless I'm entirely off base, going from the Wii U to the Switch is no great feat given the copious ports we've enjoyed thus far.
Let's be honest, Nintendo is still very much behind the curve in regards to online infrastructure and subsequently how to properly deliver and curate digital wares. Despite the Wii U I being fully backward compatible with the Wii, it tethered all purchases to a singular machine AGAIN, just like the Wii. Either Nintendo was being incompetent here or they were being rapacious but given their history of being slow to adopt industry norms, I think it's probably the former.
And while I have no idea what revenue streams they've explored internally, I can look at the robust sales of the NES and SNES Mini and note there is a healthy appetite for legacy games and at least some of that market is probably open to purchasing said games individually on a popular platform.
Also, the VC is not the best litmus test for legacy content given how poorly it was implemented. To be fair it improved with the Wii U but nobody bought the system so it hardly mattered. If and when Nintendo releases a more comprehensive and well-implemented service and consumers still largely ignore it, then you can tell me "I told you so."