There’s more to it than just nostalgia — I’ve spent a lot of time in the past several years writing NES emulators, experimenting with making little “games”/proof-of-concepts, and of course just playing NES games. But I wasn’t born when the NES was around; I didn’t grow up with the NES so I don’t really have any nostalgia for it.
Rather, I find it fun because of the technology and the constraints. The NES’s hardware is straightforward and easy to understand (but filled with cleverness and quirks, like all hardware from that era). The software side is primitive — games are typically hand-written in 6502 assembly, and there’s no operating system or standard library to hide the intricacies of the hardware. There’s something really refreshing about taking a break from our modern complicated tech stacks to go write 6502 assembly.
Some games suffer from the hardware limitations, but most are designed around these limitations, and the good games are very fun to play.
For myself and many, many other homebrew developers, it has little to do with nostalgia, and much to do with learning and the forced limitations that come with the hardware.
For someone like myself, and many other homebrew developers; it’s about unlocking the potential the hardware had. Look at Stunt Race FX for the Game Boy as a perfect example. IIRC, someone just ported DOOM to the bare-bones SEGA Genesis.
Nostalgia is why people play these games. (Well, that and they’re often excellent quality games.)
The challenge, and the learning of low level systems; is why homebrew developers choose these older systems to work with.
Also scarcity breeds innovation. There is no simpler computer that still has software development than the knockoff Z80. It's not easy making fun toys on a computer so small that has been around for nearly 50 years. We're all standing on the shoulders of giants.
It's also about the most advanced hardware a solo developer has a reasonable chance of making a game for that would rival games of the time. Much newer and the consoles won't be as well-documented, and 3D graphics add layers of complication.