The second screen of the Wii U wasn't always embedded in the controller.
With the Wii U, Nintendo is putting a high quality screen in our console controllers for the first time. However, while Nintendo always envisioned the Wii's successor with a second, portable screen, it wasn't always embedded in the controller.
In an interview with Gamasutra, Nintendo president Satoru Iwata revealed that the Wii U's second screen was once a totally separate device and not adorned with buttons and analog sticks. It was designed to be placed on a table, and was also much smaller.
With inspiration likely coming from the Nintendo DS (or Game Boy Advance to GameCube connectivity), Iwata said that Nintendo knew it wanted to add a second screen to its next console as far back as 2007. Take that THQ. The big question was how and where this screen would be implemented, as LCD costs were higher 4 years ago.
There was also a discussion about whether or not the second screen device should be able to function as its own system, or if it would only work in tandem with a console. Nintendo decided that it wanted to display the sharp graphics of a console unit on the second screen, and a battery wouldn't be able to keep up.
I think it was a good decision to put the second screen into the controller rather than having it be a totally separate entity. It would have been a major pain in the neck to repeatedly look from TV to table while playing a game.