There allready is a Remastered Version of this game on XBLA.
I don’t think so.
The fact that Timesplitters 1-3 the spiritual successor of Goldeneye and Perfect Dark uses the same controlls allthough the controllers were allready equiped with two sticks, is evidence enough that this is rather a design decission then a hardware limitation.
Beside that other Shooters of that time (e.g. Turok) show that regular shooter controlls were possible even on N64.
The real reason eventually originates in the initial plan to create Goldeneye as a lightgun/rail-shooter.