Bingo. The issue Nintendo faces is they're going to anger someone depending on how they handle it. Like they faced backlash when they hinted that Shiver from Splatoon 3 might be nonbinary, and later clarified that she wasn't. Same when they advertised that you selected your character's appearance rather than gender in Pokemon Legends, Scarlett in Violet (despite the fact the characters are still referred to as men/women in game).

What complicates PMTYD and Mother 3 even more so is even though they include gender nonconforming characters, the way they are depicted in game aren't exactly flattering by today's standards. No matter how they decide to go about rereleasing these games they're going to anger someone.

If nintendo keeps the PMTYD localization as is, or change Mother 3, it's going to cause backlash because nintendo is more or less removing trans and gnc characters out of a game that originally had them. Likewise, if they decide to changePMTYD to include Vivi's original trans plot, or release Mother 3 unchanged, They will facebacklash from people who take offense to LGBTQ people being in any form of media, especially in family entertainment which is Nintendo's bread and butter. Even that aside, they might face backlash for how these characters are depicted and handled, because these were early 2000s games made by Japanese developers who used unflattering Japanese stereotypes for queer characters. Then you would have people who would want no changes to the localization because they just want to play the PMTYD from their childhood, and they would also be dragged into this complicated and heated debate.

Either way, Nintendo would be walking into a minefield no matter how they decide to release these games, and have probably elected to simply keep them vaulted. Maybe there will come a time where they will be able to rerelease/localize them with little controversy, but as things are right now, it's a little dicey, especially for games they don't even know will be profitable.