I think you misunderstand. What I'm comparing are the best selling non-AAA JRPGs, to look at what the ceiling could be for such titles. The ceiling is generally what people look at for the size of an audience (ie: if you make the most appealing product in that class on this platform, how much can you hope to sell). So currently the examples are Xenoblade 2 and Octopath. The fact that Octopath sold as well as XB2 is a really good sign for a game which is much less resource intensive in development. But it also shows that currently at least, a "bigger" game like XB2 didn't sell more. Nier is a comparison because it is also in this class of games, non-AAA, but sold far better than expected. That's all.
Yeah this is exactly what I'm talking about. It's not "Octopath didn't sell as much so Switch sux" but rather there's still quite a lot of room for growth before we talk about the core audience being massive. It's way, way healthier than it was in previous generations of Nintendo consoles, but we're only in the second year now. It should get much bigger.
Octopath and Xenoblade also sold far better than expected, you have to understand that for system exclusive on one platform, breaking a million especially is already a big deal, especially for a JRPG.
With Xenoblade you also have to consider that the series has always been super niche, so XB2 is basically the Fire Emblem Awakening of the franchise, and there is so much they can expand from here.
As for Octopath instead, it could get better only if Square Enix starts to treat it as one of their pillar franchises, which would mean higher budget, but i feel their plans is rather to keep it to this level, so they won't expect another big growth from here.