This is featured in Dolphin Emulator (Ishiiruka version).
WITHOUT PHONG LIGHTING:
WITH PHONG LIGHTING:

My screenshots are perhaps not the best example. For some reason only Link, NPCs and the sky seem to be impacted by the effect. I hope we can see this effect implemented in Reshade, its a great effect with the right implementation and arguably makes older games look more stunning.

Phong is simplest NdotL lighting. Now what we'd need for that is global light direction and normal vectors of the surface (light intensity based off the angle between surface and light vector). The latter can be reconstructed from depth buffer but they ignore smoothing groups so the lighting would make the single polygons visible. Now we need light direction. Problem is here, ReShade only has color and depth so by rotating the camera, you'd also rotate the light. And that looks really weird.

I understand clearly now why it can't be implemented, thanks for the answer.