Why were the N64 analog sticks so inferior to those that came after?

Question

The Nintendo 64 controller's Control Stick seems to have paved the way for the analog sticks adopted by all major game consoles ever since. You can tell, too, because it really rather sucked compared to the others.

It wore out quickly, acquiring a large zone* where it could wiggle freely, usually within the stick's unresponsive dead zone, but occasionally exceeding it and causing undesired input. There was also that white residue that built up in the well it stuck out of, which I never could figure out whether was scrapings from the stick itself, or some kind of lubricant escaping to the surface of the mechanism.

It's obviously visibly different from most other analog sticks; the stick itself descended all the way down into the mechanism, while most others that came after had a small nub attached to a larger rotating sphere.

So if there's anyone out there familiar with controller design, tell me: What was it, mechanically speaking, that Nintendo didn't do quite right the first time? What all goes on down there inside analog sticks?

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* EDIT: I originally conflated the dead zone, where the stick doesn't respond to movement, with the "wiggle zone", where the stick moved freely after wear and tear. I've now fixed it above.

Answer

The N64 analog stick is extremely unusual. It does not use potentiometers, as most other platforms (i.e. playstation controller), but instead used a geared-up digital incremental rotary encoders.

^{This is also why you have to have the control stick centered when the system turns on. Since the stick mechanism has no concept of "centered", the N64 assumes that whatever position the control stick is in when the system is turned on is "center".}

As the gearing wore down, the play of the controller progressively increased.

Wikipedia:

The N64 Analog stick does not use analog potentiometers. It uses light emitting diodes and photo detectors controlled by sensor wheels. The sensor wheels are plastic hubs which produce a shutter effect allowing for an accurate direct digital read. The sensor wheels give direct correlation to the stick position compared to potentiometers which can change resistance values over time. However gameplay function of the stick itself is not on or off digital, but analog in a sense, the more the stick is pushed the faster a game character would walk to run.

The analog stick was prone to some long-term reliability issues. If used excessively, the stick became "loose", which means it will not fully return to center position, which may render gameplay more difficult by giving unintended, non-user input to the system. This loosening can be caused by rotating it intensively - a common practice in games like Mario Party where it offers an advantage for some mini-games.

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