Infendo has the nail in the coffin news concerning Project H.A.M.M.E.R. and it’s status or lack thereof. One quote from Beth Llewellyn sums up the whole situation:

Joystiq.com: What’s the status of Project H.A.M.M.E.R. or Disaster: Day of Crisis?

Disaster is still in development. Project H.A.M.M.E.R. we’ve sort of shifted resources off that title. But Disaster is still in development. Again, you have to remember, E3 is one small little blip in time and we tried to focus on a few key titles. Rest assured, there is a lot more going on behind the scenes at Nintendo. You know the company, and we always have stuff going on …

Joystiq.com: Are you talking about the reasons why H.A.M.M.E.R. has been cancelled?

No.

Cancelled! After a brief showing at E3 2006, Project Hammer (enough with the periods) was high on the list of games to keep an eye on for the Wii and much like a few other titles shown during that E3, little has been said about it since. Now we find out why and while it’s sad that the game won’t be coming out as expected, perhaps it can make an appearance as a smaller title released through the upcoming Wii Ware platform? We shall see, here’s some video footage of Project Hammer in action: