My son loves the Wii Sports and Wii Resort activities and he just turned 3. These have a variety of games they can play from tennis, bowling and baseball. We got him the Elmo game, but he is left handed and has a hard time holding the remote sideways like it requires.
My son has a ton of different toys and Wii is just one more option of something he plays with. He is an active 3 year old who loves anything sports. I don't think playing Wii is affecting his brain function or stunting his development in any way. Actually it is teaching him good hand eye coordination.