The 'Blinking Light' issue was caused by a faulty/incomplete connection or otherwise a technical issue with the NES not being able to authenticate the lockout chip mechanism. If the chip is not present (or removed) from the console then the blinking light issue doesn't happen.
Cleaning and maintenance of retro consoles is important. Doing so for a top-loader is significantly easier to do than for a front-loader. And as I already stated the original Famicom was a top-loader and the NESv2 was also a toploader later in the console's lifespan. Nintendo themselves admitted that the front-loader design is not necessary.
If someone wants it for nostalgia? Sure ok. But I get my nostalgia from the games rather than the mechanism by which they were loaded into the console.
The NESv2 can be modded cheaply (or even come modded) for a lower cost than what the AVS thing is selling for. There are also many other clone consoles available that do the job better/cheaper. Or just grab a raspberry pi, put it inside the shell of an NES classic, stick RetroPie on there and away you go :P
As a proud original gen1 'grey box' NES owner who played the hell out of dozens of popular and unpopular games nearly every weekend for years during my youth, I have found absolutely zero discernible differences between the audiovisual experience playing on original NES versus playing in an emulator like puNES. I'm a HUGE HUGE stickler for the audio part especially and it works flawlessly on everything thrown at it.
The NES and SNES classics are emulators. That's all there is to it. I don't doubt that Nintendo very liberally used the information provided by the open-source retrogaming emulation community to make their emulators. That being said though it is great to spread the love of gaming to as many people as possible and especially to the newer younger generation who didn't grow up with them. It is difficult to do that if one has to hunt down cartridges that are often significantly-inflated in prices.
With an emulator you can also play other-region games and prototype games without having to take out a 2nd mortgage to pay for it all.