I think that article about Iwata is misinterpretation or something, in this Bloomberg article Iwata says no possibility for that.
http://www.bloomberg.com/apps/news?pid=jpconewsstory&refer=jpconews&tkr=7974:JP&sid=a5HWDJhcP7eY
Yep, Nintendo headhunting for KK has been debunked already.