Oh, the eminent Nintendo designer still answered the question directly. He just said that Peach's flowing gown would have required different programming to incorporate her as a playable character in New Super Mario Bros. Wii. See? Get it? "Skirt issue?"
Destructoid says Wired's Tracey John brought up the question (at the same roundtable at which Miyamoto was told Capt. Lou Albano had died.) Miyamoto's response, according to a transcript:
I thought it'd be nice to have her as a playable character, but the toad characters had a similar physique to a Mario character than Peach does. And if one of the four had a dress, we'd have to come up with a special programming to handle how the skirt is handled in the gameplay, and that's really the only reason why Peach isn't playable (laughs). Of course If we had Wario in there we'd have to program a way to make him fart. (laughs)
Here's another way to look at it - if Peach is playable, who are you going off to save?
Miyamoto on the New Mario [IGN: full transcript, the last question is the relevant one. Via Destructoid]