IIRC according to Nintendo break even sales levels for Breath of the Wild were around 2m.
That no doubt helped with that breakeven point.
It also took around 5-6 years to make. There’s not enough time for another new 3D Zelda game (be it in the style of BOTW or the more traditional style) to be released during the Switch’s life time (hell it basically skipped the Wii U entirely!)
So there is certainly a cause for having a smaller scale title in the vein of ALBW on Switch.