While per wafer do cost more the smaller it goes, it didn't mean it cost more to produce a switch 2 because of it.
For example SiliconExpert has some data on how much wafer cost on TSMC chips.
5nm FinFET cost $16,000 per wafer and 7nm FinFET cost $10,000 per wafer. However, there's two more data point needed to discuss. Wafer density and yield. I will cut to the chase, the density between 7nm and 5nm is 1.8X. Which means it cost less per chip in the 5nm process.
What about the yield?
It sound weird but the yield gets better for some reason(using last years data), the 5nm process has 80% and the 7nm has 70% yield. The data is from Granitefirm
If you search online like wiki you fill find that the 5nm has once again increase to 90% yield. Since I can't find anything on the 7nm, I use last year's number for comparison.
As you can see, it in fact cost less using a smaller node... assuming you are TSMC chips. I can't for the life of me find the cost and yield for a Samsung 8nm wafer of any kind. I know Samsung has lower yield, but that about it. Nintendo may use Samsung wafer if
1. TSMC production if full and can't receive any order until later
2. Samsung even with its bad yield has lower prices
3. With a different node Nintendo has to redesign the board around it. It maybe lack of time, laziness, or cost for the redesign.
Some of you may wonder why 5nm has less defect then 7nm. Well, is a balancing act, I will not go into detail. But I would think one key factor is like AMD chiplet vs intel Monolithic chipset some years ago.
Since I am a "guests" it will not allow me to post any links to show any of my data.