"Dead console" (compared to 2013? lol) isn't probably the major reason
Capture cards are plug and play, compared with soldering 16+ pins per screen you want to record, and can be meaningfully reused with other sources or sold
They're also cheaper due to not there being a de facto monopoly on them
Cheap asses, buy a capture card like a normal person. A software solution would cause lag as well most probably. Maschell already tried this and only "weak" VC games like Shovel Knight ran in full speed. It's not even worth it at all...
I've seen a few sites mainly stockholder circlejerk blah blah sites talking about it....but ND Twitter has said nothing and Atari has been as well...I'm wondering if this is a fake story to get Atari stock up