Talk to your kids about it. Tell them exactly what you've said here - they've got the Wii, and really, that's enough for them. And then maybe toss up the idea of giving it away to a charity? My DD1 is always keen to help out other kids who are less fortunate. She'd give away the train in her hand as it rattled along her train track to make a kid with no toys feel happier.

Then you get rid of it AND you get to troll your SIL.