Former Gunners striker Nicholas admitted to Sky Sports that the attacking duo are Arsenal’s "best players” but does not trust them to perform in the big games.
Instead the Scotsman would revert to the same team which held Chelsea to a 0-0 draw, with Danny Welbeck and Alex Iwobi in behind striker Alexandre Lacazette.
Nicholas told Sky Sports: "Are they two of our best players? Of course they are, but they don't do enough in these big games.
"Welbeck isn't as talented but what you've got to do against a back three is move them about to create chances, while Lacazette is our best finisher and sulky Sanchez doesn't like playing out wide.
"I'd play Alex Iwobi as well. People will question me for leaving those two out but it worked against Chelsea.
"I'd have Aaron Ramsey in central midfield with Granit Xhaka, but my concern is that Wenger sticks with his principle of playing two holding midfielders, even though he doesn't have the right players to play in those positions."
Sanchez and Ozil are both out of contract at the Emirates Stadium at the end of the season, but have both started each of Arsenal’s last three Premier League games.
That Nicholas is prepared to sacrifice them for a lineup which, at best, contained Chelsea away from home shows the fear factor in the Arsenal camp ahead of Tottenham’s visit.