Probably a little nostalgia. The SMS sound chip is one of the cheapest and most primitive jellybean sound chip of the era (only 3 square waves, noise and no envelope generator either). That isn’t to say appreciating the art of doing more with less isn’t valid. It’s sort of like a MS Paint type of thing though.
I agree. I had an SMS growing up and always noticed the music sounded "cheaper" than the NES, almost childish. I think it really was just the square waves making everything sound the same. The NES had more interesting output with its triangle and sawtooth wave output and it gave it more edge and character.
It may not have had a sawtooth but it did have the DMC (sample channel) which although very quirky could create a lot of variety - and used melodically to give you, for instance, a sampled bass - or drums - or an orchestral hit!
The NES' own sound chip didn't have a sawtooth channel, but some games had an onboard sound chip that added one, like Konami's VRC6: https://www.nesdev.org/wiki/VRC6_audio
The Japanese Mark III had an available Yamaha FM expansion kit that could sound pretty great. US-based gamers couldn't listen to the soundtracks at the time, but emulators and whatnot make it possible to experience today.
I understand it as more of the latter than the former.
Hardware might not have been great, but they were dedicated to push it to the extreme limits of what it could do, and all of it was punching way above its weight in all respects.
Japanese companies saw an opening, and extremely brilliant people went in head first, sleeping under their desk to leave their mark in the field.